Educomp surges 10% as US company plans to buy majority stake

MUMBAI: Shares of beaten down Educomp Solutions, a diversified education services provider, surged nearly 10 per cent in trade on reports that a large US-based strategic acquirer is in fairly advanced talks to buy majority shares in the company.

“The potential acquirer may invest about $300 million (Rs 1,800 crore) through a combination of primary shares and mandatory open offer to emerge as the majority shareholder in Educomp, people directly familiar with the matter told TOI. They declined to identify the potential suitor as talks were currently private and not yet conclusive,” said TNN report.

Since May 2013, the stock price of Educomp has dropped more than 60 per cent while its market capitalization has narrowed from about Rs 900 crore to just around Rs 300 crore at the close of trade on Monday.

The company recently announced that its corporate debt restructuring with lenders led by the State Bank of India had been approved.

At 10:10 a.m., the stock was at Rs 27.75, up 9.90 per cent, on the BSE. It touched a high of Rs 27.75 and a low of Rs 27.30 in trade today. Around 1.76 lakh shares were traded in the counter against two-week average of 1.06 lakh shares.