Jaiprakash Associates gains on divesting its two cement units to UltraTech Cement

24 Dec 2014

Jaiprakash Associates is currently trading at Rs. 24.10, up by 0.65 points or 2.77% from its previous closing of Rs. 23.45 on the BSE.

The scrip opened at Rs. 24.80 and has touched a high and low of Rs. 24.90 and Rs. 24.30 respectively. So far 9,15,000 shares were traded on the counter.

The BSE group 'A' stock of face value Rs. 2 has touched a 52 week high of Rs. 89.85 on 11-Jun-2014 and a 52 week low of Rs. 23.05 on 23-Dec-2014.

Last one week high and low of the scrip stood at Rs. 25.70 and Rs. 23.05 respectively. The current market cap of the company is Rs. 5,862.00 crore.

The promoters holding in the company stood at 39.56% while Institutions and Non-Institutions held 36.25% and 24.19% respectively.

Jaiprakash Associates (JAL) has received an approval for disinvestment of its two cement units to UltraTech Cement. The board of directors at their meeting held on December 23, 2014 has approved for the same. The company will sell its integrated cement plant with clinker capacity of 2.1 MTPA and cement grinding capacity of 2.6 MTPA at Bela, Madhya Pradesh along with CPP of 25 MW and its integrated cement plant with clinker capacity of 3.1 MTPA and cement grinding capacity of 2.3 MTPA at Sidhi, MP along with CPP capacity of 155 MW.

The board has approved the Memorandum of Understanding setting out the broad terms and conditions of the proposed acquisition. The Enterprise Value of this acquisition has been agreed at Rs 5,400 crore. The transaction is subject to customary due diligence, definitive agreements and regulatory approvals as may be required.

This disinvestment is in line with the Jaypee Group’s publicly announced policy of bringing down JAL’s debt and improving its balance sheet. Axis Capital was the transaction advisor in this process.

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