Shares of Pricol Ltd jumped 2.11 percent to Rs 242.35 in morning trade on June 5 after promoters of the auto components major raised their stake in the company by 1.38 percent.
Pricol is in the midst of fending off a hostile takeover attempt by rival Minda Corp.
In a regulatory filing after market hours on June 2, Pricol said promoter group firms Pricol Engineering Industries and Pricol Logistics have bought 15,00,000 and 1,82,000 shares, respectively, from the open market.
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These represent 1.23 percent and 0.15 percent stake in Pricol Ltd. As of the March 2023 quarter, promoters held 36.53 percent stake in the Coimbatore-headquartered firm.
Earlier in February, auto-ancillary maker Minda Corp had surprised the market by acquiring 15.7 percent of Pricol for around Rs 400 crore. This prompted Pricol promoters - led by Chairman Vanitha Mohan and Managing Director Vikram Mohan - to clarify that they had no interest in paring their stake.
Subsequently in May, Minda Corp approached the CCI to increase its stake in Pricol up to 24.5 percent but the company has filed a preliminary objection against the application.
Shares of Minda Corp slipped 0.45 percent to Rs 297 in morning trade on June 5 after the company said it has received board approval for raising up to Rs 600 crore.
Also Read: Why is Minda Corp keen on a reluctant Pricol?
The fund raising will take place through further issuance of securities through public and/or private offerings, including preferential issue, qualified institutions placement, and further public offer.
"This fund-raise approval at Minda Corporation is in response to earlier intimation of buying an additional 9 percent stake in Pricol Ltd. At the closing CMP of Rs 237 per share, consequent outlay for it is pegged at Rs 255 crore," ICICI Securities said in a note.
"With higher-than-expected approval of fund-raise, we expect the company to execute more tangible steps in its pursuit to acquire Pricol Ltd (voluntary open offer could be one of them). On the other hand, this open market stake purchase by promoter group of Pricol is its first tangible
step for stake increase, thereby depicting confidence in the company," it said.
Shares of Minda Corp have gained over 45 percent this year so far, while Pricol is up 23 percent.
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