The Tanti family, promoters of Suzlon Energy Ltd, on Monday reported the sale of about 60 million shares or about 4 per cent of the paid-up share capital of the company. Funds raised from the sale would be used for completing its long-pending acquisition of REpower of Germany.
Post-sale, the total promoter shareholding in the company stands at about 60 per cent. The company has not stated the sale price of the shares.
Company sources said that the shares were sold at about Rs 87 per share and it mopped up about Rs 522 crore.
On the BSE, the intraday movement of the stock was volatile and at the closing on market hours it was traded at Rs 89.05 (Rs 94.10) a decline of 5.37 per cent.
On behalf of the family, the Chairman and Managing Director of Suzlon, Mr Tulsi Tanti, in a press release said, “Funds raised through the sale of this stake are going to be used primarily to advance inter-corporate deposits through promoter group entities to the company to part-finance the buyout of the stake held in REpower Systems AG by Martifer SGPS. This stake sale will ensure that the overall timeline in implementation of REpower integration is not delayed.”
Mr Tanti said that the promoters will not be required to sell additional shares in the near future.
Suzlon had finalised a revised payment schedule in December 2008 for acquiring Martifer’s 22.4 per cent stake in REpower. Under this, Suzlon would pay the Portugal-based Martifer €65 million in December, €30 million in April and the final tranche of €175 million in May. On completing this transaction, Suzlon would hold approximately 91 per cent stake in REpower.
On May 13, one of the promoters had sold a 2 per cent stake through a block deal for about Rs 235 crore. The money was to be used to redeem some pledged shares and to make payments of outstanding amounts for wind turbines supplied and installed by Suzlon for some promoter-owned companies.
According to a sector analyst with a leading stock broking firm,the sale of shares by the promoters is a positive sign as it signals that the company is serious about acquiring REpower. The market reaction to the stake sale is surprising but it will take a few days to correct, according to the analyst.
Source: The Hindu Businessline