M&M to acquire 38% stake in EPC Industries
Diversified firm Mahindra & Mahindra (M&M) today said it will acquire 38% stake in EPC Industries for Rs 43.35 crore to mark its foray into the micro irrigation business.
February 09, 2011 / 22:17 IST
Diversified firm Mahindra & Mahindra (M&M) today said it will acquire 38% stake in EPC Industries for Rs 43.35 crore to mark its foray into the micro irrigation business.
"The board of M&M approved the acquisition of 38% equity in EPC Industries... The acquisition is through preferential allotment of shares by EPC," the auto major said in a filing to the Bombay Stock Exchange (BSE).The company would be making an open offer to EPC's shareholders for acquiring 20% of the enhanced share capital of the firm, it added.Micro irrigation is a water efficient technology that reduces the usage of the natural resource, while improving the productivity in agriculture."The company would subscribe to 65,58,065 fully paid-up equity shares of the face value of Rs 10 each of EPC, on a preferential basis, at a price of Rs 66.10 per share," the filing said.On the completion of the preferential allotment and the open offer, M&M would be acquiring the management and control of EPC and would be classified as promoter of EPC.Commenting on the deal, M&M President (Automotive and Farm Equipment Sectors) Pawan Goenka said: "With rising population and reducing water availability, micro irrigation is an important method to reduce water consumption in agriculture to raise agriculture productivity in the country."Established in 1981, EPC is currently present in over 12 states and sells many equipments, including dip irrigation systems and industrial pipes."A revitalised EPC will now have the opportunity to play a very important role in helping the farmer community to improve yields and manage the water resources more meaningfully," EPC Industries Promoter K Khanna said.The shares of EPC Industries today closed 2.14% down at Rs 64.15 apiece on the BSE.M&M shares jumped 4.06% to close the day at Rs 654.20 apiece on the BSE. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
