Forbes & Company share price spiked 5 percent hitting new 52-week high of Rs 2,600 per share on BSE after the Shapoorji Pallonji Group shortlisted three suitors for the big-bang sale process of its consumer durable flagship Eureka Forbes.
Eureka Forbes is a subsidiary of listed parent company Forbes & Company.
The Shapoorji Pallonji Group has shortlisted three suitors for the big-bang sale process of its consumer durable flagship Eureka Forbes, a household name in the vacuum cleaner and water purifier segments, people with knowledge of the matter told Moneycontrol.
Also Read: Race for Eureka Forbes heats up: Electrolux, Advent International and Warburg Pincus in the fray
“ Currently, it’s a three-way race between private equity firms Advent International , Warburg Pincus and Swedish home appliance maker Electrolux. These players have been shortlisted for this high-profile deal and they are conducting due diligence,” sources said.
The Shapoorji Pallonji group is looking to unlock value and also reduce its debt burden through the proposed transaction, this individual added. An internal restructuring exercise, involving a demerger of Eureka Forbes from Forbes & Company is also being pursued simultaneously, he elaborated. Demerger procedures are taken up for approvals at the NCLT ( National Company Law Tribunal).
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“ Standard Chartered Bank has been mandated to find a suitable buyer and binding bids are expected to be submitted after a few weeks. The SP group is expecting premium valuations in the range of Rs 6,500 crores to Rs 7,000 crores. In case of differences over valuation, a deal may be struck in the region of Rs 5,000 crore to Rs 6,000 crore,’ a second person, an industry executive, told Moneycontrol.
The Board of Directors of the Company have authorized the management of the company to evaluate a scheme of arrangement and/or other appropriate mechanisms to enable an eventual listing of Eureka Forbes Limited, with an intention to unlock value in the hands of all the shareholders of the Company. These may also include listing, dilution/sale or combination thereof of Eureka Forbes Limited.”
The stock was trading at Rs 2519.55, up 5.44 percent at 14:07 hours. It traded on new 52-week high value of Rs 2600. The scrip also witnessed spurt in volume by more than 3.15 times and was trading with volumes of 11,236 shares, compared to its five day average of 2,410 shares, an increase of 366.15 percent.
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