M&M revvs up into first gear

Mahindra & Mahindra is currently the top gainer on the BSE, up almost 2.5% at Rs.972, its intra day high and its low point is at Rs.960.

The stock is up after the company announced a multi-structured deal entering, through a share swap with CIE auto of Spain. M&M will be buying 13.5% stake in CIE auto for 96.24 million Euro, which is at 6 Euro/share. And swapping this, M&M will sell 52.65% stake in Mahindra Forgings stake to CIE auto for Rs.393 crore and 64.96% stake for Rs.269 crore. It will also be selling 30.38% stake in Mahindra Composites for Rs.10 crore and its other arm, Mahindra Holdings will also selling 4.98% stake in Mahindra Composites for Rs 1.6 crore.

CIE Auto, has made an open offer for 11.6 lakh shares in Mahindra Composite at Rs 74.7/share and for 2.45 crore Mahindra Forgings at Rs 81/share. The new JV between M&M and CIE is to be named as Mahindra CIE which will continue to be listed on BSE, NSE. M&M stake will stand at 20.2% and public shareholding will be at 28.7%.