IIFL Holdings surges on open offer, hits 52-week high

NEW DELHI: Stocks of IIFL Holdings Limited surged as much as 20 per cent in trade to hit their fresh 52-week high today after Prem Watsa-led Fairfax India said it would acquire 26 per cent stake in the company via open offer in a deal worth Rs 1,621 crore.

The stock closed the day 10.13 per cent up, at Rs 207.05.

Fairfax has offered to buy up to 8,31,28,852 equity shares from the equity shareholders of IIFL Holdings through its arm FIH Mauritius Investments.

The offer price for the open offer has been set at Rs 195 per share, which is at a 3.72 per cent premium to Monday's closing of Rs 188 on the BSE.

The offer values IIFL Holdings at Rs 6,235. But the surge in the stock price on Tuesday helped the market capitalisation of the company swell to Rs 6,800 crore.

The stock surged 20 per cent to hit its 52-week high of Rs 225.60 on the exchange.

According to the shareholding data available with the exchanges, promoters' stake in the Nirmal Jain-led financial company stood at 29.77 per cent at the end of March quarter.

Foreign institutional investors (FIIs) accounted for a significant 39.35 per cent stake in the company. Domestic institutional investors on the other hand, held a meagre 0.70 per cent stake.

Nirmal Jain in an interview to ET Now said that the company has no plans to make Prem Watsa a co-promoter.

"We value our relationship with Prem Watsa," Jain said.

Prem Watsa has been bullish on India especially financial services, he added.

Wasta is referred as the Canadian Warren Buffett.

“When you put in Rs 1,600 crore in a company, it is not for three or six months. He (Watsa) is looking at four, five or maybe 10 years’ of horizon. I do not think that anybody doubts the potential in India. We have been through a period of the last six months when everybody has been sceptical. Deals like this augur very well for the country in general, sector in specific of course,” said Niraj Dalal, 3A Capital Advisors.