KKR to acquire controlling stake in J B Chemicals & Pharma; stock up 1%

As part of the agreement, KKR will acquire its stake from the founding Mody family at a purchase price of Rs745 per share and make an open offer for an additional 26% stake in the company.

Jul 03, 2020 12:07 IST India Infoline News Service

Shares of J B Chemicals was trading higher in today’s session on the stock exchanges. On Thursday, Global investment firm KKR has entered into a definitive agreement to purchase a controlling stake in JB Chemicals & Pharmaceuticals.

As part of the agreement, KKR will acquire its stake from the founding Mody family at a purchase price of Rs745 per share and make an open offer for an additional 26% stake in the company.

As per media reports, foreign ownership for the pharma sector is capped at 74% via automatic route, therefore, KKR’s stake cannot breach 64.9% given FII holding in the stock.

Promoters own a 55.9% stake in the company and whether they can exit completely depends on the success of the open offer.

Promoters have a right to sell their entire stake even after the transaction is completed. If it’s sold to KKR, it will be at Rs745/share.

J B Chemicals & Pharmaceuticals Ltd is currently trading at Rs719, up by Rs3.6 or 0.5% from its previous closing of Rs715.40 on the BSE.

The scrip opened at Rs740 and has touched a high and low of Rs742 and Rs701.45 respectively.

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