Jyothy Labs rallies over 15% on heavy volumes

The stock rallied 15.7% to Rs 427, also its record high on BSE in intra-day trade.

Jyothy Laboratories rallied 15.7% to Rs 427, also its record high on BSE  in intra-day trade, after a media report suggested that the deadline for Henkel AG to exercise its option to acquire a 26% stake in the company may be extended as the German firm is keen to take at least 50% stake in the Indian company gradually.

The BSE said the Exchange has sought clarification from Jyothy Laboratories Ltd on April 17, 2017, with reference to the news appeared on economictimes.indiatimes.com dated April 17, 2017 quoting "Henkel may Get Until Nov to Buy 26% Stake in Jyothy Labs"

The reply is awaited.

“Henkel AG has an option to acquire upto 26% of the equity share capital of Jyothy Laboratories through primary and/or secondary transactions, after period of 5 years, subject to the terms and conditions to be mutually agreed and the company has entered into confidentially agreement with Henkel AG in this regard,” Jyothy Laboratories said on February 23, 2017.
 

Jyothy Laboratories had made a clarification with reference to news item mentioning “Henkel begins due diligence for a stake in the company.

Jyothy Laboratories had entered into an option agreement dated May 5, 2011 with Henkel AG & Co. KGaA (Henkel AG) whereby the Company has granted Henkel AG a firm and irrevocable option, at its sole discretion at any time after the beginning of the fifty year and ending upon the expiry of the sixth year of the said agreement or such other mutually extended period, to acquire a maximum of 26% of the issued equity share capital of the Company at a price which will be mutually determined by the parties at a later date.

At 11:28 am; the stock was up 10% at Rs 407 as compared to 0.08% decline in the S&P BSE Sensex. The trading volumes on the counter surged more than five-fold with a combined 694,283 shares changed hands on BSE and NSE so far.