Zee Learn and Tree House Education & Accessories jumped by 17.05% and 18.51% respectively at 12:00 IST on BSE after the board of directors of both the companies separately approved revised scheme of merger.
Both the companies made the announcement during market hours today, 17 August 2016.Meanwhile, the BSE Sensex was up 38.40 points, or 0.14%, to 28,103.01.
Zee Learn was up 17.05% to Rs 35.35. Tree House Education & Accessories surged 18.51% to Rs 27.45.
The board of directors of Zee Learn (ZLL) and Tree House Education & Accessories (THEAL) approved revised share swap ratio of 1:1 for the merger of THEAL with ZLL. The revised scheme of amalgamation will put to rest uncertainty and anxiety within different stakeholders and help mitigating the recent developments in operational performance of THEAL over the past few quarters, ZLL said in a statement. It will further strengthen ZLL's position in the educational landscape, it said. Both ZLL and THEAL are in similar line of business activities and with a view to consolidate the business operations, the board of directors of both the companies have decided to amalgamate the companies. Both ZLL and THEAL are primarily engaged into the business of pre-school activities.
The board of directors of both the companies on 23 December 2015 had approved a scheme of amalgamation of THEAL with ZLL subject to requisite statutory and regulatory approvals. On 1 June 2016, ZLL decided to keep on hold the scheme as part of evaluation of the results of THEAL for the quarter and year ended 31 March 2016. Following this, the board of directors of ZLL had authorised the Amalgamation Committee to suggest the way forward to salvage the deal of amalgamation to ensure consolidation of business in the best interest of the shareholders. Accordingly, the board of directors of both the companies accorded approval to the revised scheme including appointed date and share exchange ratio suggested by the Amalgamation Committee for the proposed amalgamation of the companies.
Zee Learn's net profit surged 102.5% to Rs 8.02 crore on 17.5% increase in net sales to Rs 42.06 crore in Q1 June 2016 over Q1 June 2015.
Tree House Education & Accessories reported net loss of Rs 45.48 crore in Q1 June 2016 compared with net profit of Rs 18.02 crore in Q1 June 2015. Net sales fell 70.7% to Rs 20.21 crore in Q1 June 2016 over Q1 June 2015.
Zee Learn is an Essel Group company and is India's leading company in education segment with the fastest growing chain of K-12 schools and Asia's No 1 chain of pre-schools in its portfolio. Zee Learn has its preschool network Kidzee with more than 1,600 plus preschools in over 550 plus cities across India and is Asia's largest network of preschool.
THEAL is also engaged in the business of pre-school activities.
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