Suzlon Energy jumped 13.58% to Rs 21.75 at 9:37 IST on BSE after the company said it has signed definitive agreements with Dilip Shanghvi Family and Associates for equity investments of Rs 1800 crore in Suzlon Energy.
The announcement was made on Saturday, 14 February 2015.
Meanwhile, the S&P BSE Sensex was up 195.53 points or 0.67% at 29,290.46.
On BSE, so far 1.47 crore shares were traded in the counter as against average daily volume of 87.64 lakh shares in the past one quarter.
The stock hit a high of Rs 22.65 and a low of Rs 21.10 so far during the day. The stock had hit a 52-week high of Rs 36.80 on 12 June 2014. The stock had hit a 52-week low of Rs 9.50 on 27 March 2014.
The stock had outperformed the market over the past one month till 13 February 2015, surging 25.9% compared with Sensex's 6.09% rise. The scrip had also outperformed the market in past one quarter, jumping 34.57% as against Sensex's 4.13% rise.
The mid-cap company has equity capital of Rs 713.44 crore. Face value per share is Rs 2.
Suzlon Energy said it has signed definitive agreements with Dilip Shanghvi Family and Associates (DSA) for equity investments of Rs 1800 crore in Suzlon Energy. As part of the deal, Suzlon Energy's board of directors at its meeting held on Friday, 13 February 2015, approved issuance of up to 100 crore equity shares of the company to DSA on preferential allotment basis. The board also approved divestment in SE Forge, a wholly owned subsidiary of Suzlon Energy. The company intends to conduct a postal ballot for seeking approval of its shareholders for the aforementioned transactions. Post allotment, DSA shareholding will be 23% shares (based on current shareholding), while the Tanti Family will hold 24% shares. Management control remains with Tanti Family by virtue of pooling arrangement for voting, Suzlon Energy said in a statement.
Dilip Shanghvi is Managing Director of Sun Pharmaceuticals Industries.
Suzlon Energy's pact with DSA triggered an open offer for acquisition of upto 157.64 crore equity shares of face value of Rs 2 each of Suzlon Energy, from the public shareholders of the company, representing 26% of emerging voting capital of Suzlon Energy. The offer price is Rs 18 per fully paid-up equity share aggregating to Rs 2837.58 crore. The offer price is also subject to finalization of the price for the proposed preferential issue of equity shares as on the relevant date, i.e. 16 February 2015.
DSA & Suzlon intends to form equal joint venture (JV) for wind farm development business. The JV will develop 450 megawatts (MW) wind farms within a stipulated period of time. DSA also intends to assist in providing incremental project specific non-fund based working capital facility to Suzlon for execution of the said project. Further, DSA intends to provide credit enhancement to the lenders of Suzlon for additional project specific working capital facilities. This move will help Suzlon in getting much needed working capital financing support and will be a catalyst for volume ramp up, Suzlon Energy said in a statement. The above transactions are subject to closing conditions, including corporate and other regulatory approvals, Suzlon Energy said.
Mr Tulsi Tanti, Chairman, Suzlon Group, said "All the strategic initiatives are extremely crucial and will pave the way for our growth. These bold steps will strengthen our capital structure permanently, enabling significant deleveraging and liquidity to ramp up volumes rapidly. With our market leadership, technology strength, successful project execution and best in class service, Suzlon is best placed to capitalize on the opportunities offered by the renewable sector. We are convinced that the support from Dilipbhai Shanghvi and Family will help in creating a long term sustainable value for our stakeholders".
Mr Tanti added that Suzlon is poised to enter FY 2016 with a strong liquidity position to tap the opportunity available in India as well as key growth markets like USA, China, Brazil, South Africa, Turkey and Mexico.
Amit Agarwal, CFO of Suzlon Energy said that these initiatives will result in sizeable debt reduction, savings on interest expense and will provide the necessary liquidity to boost operations. These efforts resulted in positive EBIT in this quarter in addition to positive EBITDA for the fourth consecutive quarter, Agarwal said. He further added that the company continues to focus on execution of its order book.
Suzlon Energy reported a consolidated net loss of Rs 6538.68 crore in Q3 December 2014, much higher than net loss of Rs 1075.25 crore in Q3 December 2013. Total income declined 1.51% to Rs 4986.56 crore in Q3 December 2014 over Q3 December 2013. The result was announced on Saturday, 14 February 2015.
The Suzlon Group is ranked as the world's fifth largest wind turbine manufacturer, in terms of annual installed capacity and market share in 2013.
Powered by Capital Market - Live News
