Atlas Copco buyback oversubscribed

Our Bureau Chennai | Updated on March 14, 2011


Majority of tenders were at prices higher than the indicative Rs 2,250

The buyback offer of Atlas Copco was fully subscribed.

The good response, particularly at a higher price, made the company's share price gain at the Bombay Stock Exchange.

The stock closed at Rs 2,528.10, a gain of 14.56 per cent over the previous day's close.

The stock has gained about 50 per cent in the last three months.

However, it remains to be seen if the company accepts the offer, as majority of investors have tendered the shares at a price higher than the indicative price of Rs 2,250.

If the issue falls through, then the stock price may plummet, as has been seen in the case of several delisting issues.

According to the BSE Web site, the company received 39.09 lakh shares as against the planned mop-up of 36.62 lakh shares. On behalf of Atlas Copco AB, the Sweden-based promoter of the firm, JM Financial has made the offer to obtain full ownership of the company.

The offer was closed on March 11.

According to December 2010 shareholding pattern, the Swedish parent holds 83.77 per cent stake in Atlas Copco, while domestic institutions' stakes stood at 2.45 per cent and retail investors' holdings at 11.72 per cent.

The promoters made the offer to buyback the remaining 16.23 per cent at a floor price of Rs 1,426 a share.

The company had also provided an indicative offer price of Rs 2,250.

After the buy back, Atlas Copco shares would get delisted from the BSE and the Pune Stock Exchange. It was not listed on the National Stock Exchange.

Atlas Copco (India) is a subsidiary of Sweden-based Atlas Copco AB. The Indian unit manufactures air and gas compressors, construction and mining equipment and industrial tools and commands a major market share in the domestic market.

For the full year ending December 2010, sales expanded 32 per cent to Rs 1,272 crore. Net profits jumped 75 per cent to Rs 86 crore.

Published on March 14, 2011

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