Fresenius Kabi up over 17%

Fresenius Kabi is strongly up in the green today, currently up 17.5% at Rs.129.70, with an intra day high at Rs.132.45. Its 52-week high is at Rs.152.45. Volumes are HUGE at over 2.5 lakh shares compared to around 7500 shares over past two weeks average.

The stock is surging after SEBI allowed the company to delist its shares and within a period of 3 months. Ending the ongoing dispute, SEBI has stated that  the company should consider the October 2012 pre-offer-for-sale (OFS) of promoter holding to determine the minimum number of shares to be acquired for the delisting. In April, the company had expressed its intention to pay an indicative price of up to Rs 130/share to acquire the balance 19% stake from public investors.

The promoters of the company held 90% stake and then they sold 9% stake through an OFS route. But then instead of selling the 6% stake to meet the 75% stake SEBI requirement, the company, after setting an indicative price of Rs.80/share, changed its plans and decided to go for delisting. As the company had benefitted from an OFS route, SEBI did not allow delisting. The company justified the delisting on grounds of “extraneous” events.