Shares of Ballarpur Industries today surged nearly 7 per cent as the company's subsidiary Ballarpur Paper Holdings BV said it will sell entire 98.08 per cent stake in its Malaysian arm Sabah Forest Industries (SFI) for USD 500 million (about Rs 3,307 crore).
The stock gained 6.38 per cent to settle at Rs 15.85 on the BSE. During the day, it jumped 9.39 per cent to Rs 16.30.
At NSE, shares of the company climbed 6.73 per cent to Rs 15.85.
In terms of volume, 17.69 lakh shares of the company changed hands at BSE and over 54 lakh shares were traded at NSE during the day.
The sale proceeds will be used for retiring debt of its group companies.
"Ballarpur Paper Holdings BV, a step down subsidiary of the company and holding company of SFI (BPH), has signed a share sale agreement (SSA) with Pandawa Sakti (Sabah) Sdn Bhd, Malaysia, a subsidiary of Pandawa Sakti Sdn Bhd Malaysia and Pandawa Sakti Sdn Bhd (Guarantor) for sale of its entire equity stake of 98.08 per cent in SFI, at SFI's enterprise value of USD 500 million on a cash-free debt-free basis," Ballarpur Industries said in a BSE filing.
"The completion of transaction is subject to necessary regulatory approvals of the Government of Malaysia, SFI lenders and completion of certain obligations by the Purchaser, as per SSA," it said.