Century Textiles gets 'ultra' attention
Century Textiles figures amongst the top gainers on the BSE today, currently up 7% at Rs.764.80, its intra day high. Earlier in this month, the sock had hit a new high at Rs.793.35.
The stock is up and about in the green today on unconfirmed news reports that the company plans to hive off its cement unit and merge it in an all share deal with Ultra Tech Cement. The enterprise value of its cement business is placed at Rs.10,500 crore. Obviously the market is enthused as it will would mean that Century will become debt free, utilizing the money to pay off debt taken to fund expansion of its Madhya Pradesh plant.
It is Kumaramagalam Birla who owns Ultra Tech and he is the one who Chairs the meets of Century. He owns 37% stake in Century through Pilani Investments and a total of 51% in Pilani Investments, the holding company, jointly owned by BK Birla and Kumar Birla. As such Century has synergy with UltraTech for cement and Madura Garments for textiles. Thus this merger, economically is a great move for Century.
Century will be declaring its Q4 and FY15 performance on 5th May.