Essar Oil promoters to hike stake
Essar Oil said on Wednesday that its board will meet to consider a preferential offer to promoters, a move that could possibly lead to the company being delisted from the stock markets.
By TNN |
MUMBAI: Essar Oil said on Wednesday that its board will meet to consider a preferential offer to promoters, a move that could possibly lead to the company being delisted from the stock markets.
In a late evening notice to the stock exchange, Essar Oil said that a board meeting will be held on Friday to consider a further issue of securities to promoters. Regulatory rules provide for companies making a compulsory delisting offer to shareholders if the public shareholding in the company falls to less than 10%.
The combined stake of promoters and associates in the company is about 88%.
The Essar group had tried to delist two other listed companies — Essar Shipping and Essar Steel — earlier this year without much success. In case of Essar Steel, the price discovery at Rs 48 has been very low, which was way below the replacement cost or the fundamental value.
Essar Oil shares soared on Wednesday, climbing 32% to Rs 120.80 at the Bombay Stock Exchange (BSE) on Wednesday after touching all time high of Rs 139.90.
The company is increasing the capacity of its Vadinar refinery to 16 million tonnes from 10.5 mmtpa by 2008-09. This would be during same time, when Reliance Petroleum’s 27 mmtpa refinery is coming on stream.
In a late evening notice to the stock exchange, Essar Oil said that a board meeting will be held on Friday to consider a further issue of securities to promoters. Regulatory rules provide for companies making a compulsory delisting offer to shareholders if the public shareholding in the company falls to less than 10%.
The combined stake of promoters and associates in the company is about 88%.
The Essar group had tried to delist two other listed companies — Essar Shipping and Essar Steel — earlier this year without much success. In case of Essar Steel, the price discovery at Rs 48 has been very low, which was way below the replacement cost or the fundamental value.
Essar Oil shares soared on Wednesday, climbing 32% to Rs 120.80 at the Bombay Stock Exchange (BSE) on Wednesday after touching all time high of Rs 139.90.
The company is increasing the capacity of its Vadinar refinery to 16 million tonnes from 10.5 mmtpa by 2008-09. This would be during same time, when Reliance Petroleum’s 27 mmtpa refinery is coming on stream.
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