Auto component group Amtek, led by Arvind Dham, is restructuring ownership of its public listed company Amtek India wherein promoters are selling their shares to another public company Amtek Auto in a deal worth up to Rs 340 crore. Amtek Auto will, in turn, make an open offer to acquire another 20% stake in Amtek India that could cost it around Rs 150-175 crore. Both Amtek India and Amtek Auto are backed by a slew of financial investors including Warburg Pincus and ChrysCapital.
As per the agreement, Amtek Auto is acquiring 40.2% stake owned by promoters in Amtek India at a price not exceeding Rs 68 through a block deal or an off market transaction. As a part of this, Amtek Auto has already acquired a large chunk of 26.25% from the promoters at an average price of Rs 64.83 or a deal worth Rs 215 crore. Now it proposes to make an open offer to acquire another 20% stake that would make Amtek India a subsidiary of Amtek Auto.
Incidentally, promoters held just 28.97% stake in Amtek Auto as of March 31, 2010. It is not clear what the Dham family plans to do with the money encashed from the transaction. Amtek Auto scrip was up 2.6% on Friday while Amtek India share price 4% to close at Rs 66.5.