Tuesday, April 30, 2013

Unilever to hike stake in HUL

April 30, 2013

Unilever plc. On Tuesday announced a voluntary open offer to hike stake in Hindustan Unilever (HUL) up to 75 per cent from the current 52.48 per cent at a price of Rs. 600 a share.

Following this announcement, the shares of HUL, a market leader in the FMCG business in India, went up by 16.28 per cent at Rs. 578.20.

Paul Polman, CEO, Unilever, said in a statement on Tuesday morning: "This represents a further step in Unilever's strategy to invest in emerging markets and offers a liquidity opportunity at what we believe to be an attractive premium for existing shareholders. The long heritage and great brands of Hindustan Unilever, and the significant growth potential of a country with 1.3 billion people make India a strategic long-term priority for the business."

The offer, which is made pursuant to the rules of the Securities and Exchange Board of India, is to acquire up to 487,004,772 shares, representing 22.52% of the total outstanding shares of HUL, which would increase Unilever's stake to up to 75%. Securities regulations in India require a minimum public shareholding of 25% for a company to maintain a public listing in the country.

The offer, payable in cash, represents a premium of approximately 29.5% over the mandatory floor price required under Indian regulations, a premium of 26.0% to HUL's last one month's average trading share price and 25.0% to the last one week's average trading price on the National Stock Exchange of India Limited. The potential total value of the transaction at the offer price (assuming full acceptances) is approximately INR 292.2 billion or €4.1 billion.

Subject to regulatory clearance, the offer period is expected to begin in June 2013. Payment for the shares will take place shortly after close of the offer. The offer is being managed by HSBC Securities and Capital Markets (India) Private Limited.
News From: http://www.7StarNews.com

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