Amtek Auto rallies 5% as Bharat Forge, Sona Koyo join acquisition race

NEW DELHI: Shares of Amtek Auto advanced nearly 5 per cent on Thursday on reports that Bharat Forge and Sona Koyo Systems are in race to acquire all or part of the company's businesses.

Private equity players such as Blackstone Group, KKR and DA Capital have reportedly shown interest in acquiring the auto component major.

Following the development, the shares of the company advanced 4.92 per cent to end the day at Rs 30.90.

According to the report, the deal could add up $1billion of value. Lenders to the debt-laden group are looking to auction the units off to get their money back, it added.

The lenders want to bring in equity capital and settle 25 per cent of the total debt of around Rs 20,000 crore through this process. Following this, 25 per cent of the debt will be retired once the group regains operational stability. The remaining 50 per cent of Amtek's dues is to be repaid through a long-term arrangement involving a mix of low-coupon debt and equity, ET reported sources as saying.

Reacting to the news, shares of Bharat Forge gained 2.53 per cent to end at Rs 1082 and shares of Sona Koyo ended the day at Rs 86.50, up 1.41 per cent.

Meanwhile, BSE Sensex gained 23 points to close at 30,857.52.