Shares of Veranda Learning Solutions, a recent debutant of Dalal Street, hit the upper circuit on Tuesday after the company acquired education institute TIME.
The Chennai-based Veranda said it has signed an agreement to acquire the test-preparation institute chain, TIME, for Rs 287 crore.
Following the development, shares of Veranda Learning rallied 5 per cent, its daily circuit limit, to Rs 208.45 to hit a new lifetime peak. The scrip had settled at Rs 198.55 on Monday.
Veranda Learning Solutions made its debut on the bourses earlier this month. The company raised Rs 200 crore via its initial public offering, selling shares in the range of Rs 130-137 apiece. Shares of Veranda are trading more than 52 per cent above the issue price. The scrip had rallied over 15 per cent on its debut to Rs 157.20 on BSE on April 11.
The acquisition will be made in two phases, with Veranda taking over 80 per cent of the outstanding capital along with management control in the first phase, whereas the second phase will include the remaining 20 per cent at the end of two years.
Founded in 1992, Hyderabad-based TIME is known for test preparation courses for MBA aspirants and test takers of the Common Admission Test (CAT). At present, it has a pan-India presence and operates 188 centres, including franchisees, across 98 cities in India.
It said it has trained around 2.2 million students since inception, with a run rate of training almost 110,000 students every year. It also offers its CAT test series – AimCat – with 37,000 unique test takers for the course.
The company also has a chain of pre-schools under the TIME Kids brand and operates through 222 pre-schools in 56 cities. With the acquisition, Veranda has also diversified into the pre-school and the language training space.
Source: Economic Times