Tata Global Beverages Ltd (TGBL), formerly known as Tata Tea, is merging its packaged drinking water subsidiary Mount Everest Mineral Water Ltd (MEMW), which operates through its premium brand Himalayan, with itself for increasing operational efficiency and better synergy between both businesses, as per a stock market disclosure.
Currently TGBL holds 50.07 per cent stake in MEMW. The exchange ratio recommended by the valuers and approved by both the boards is 3 shares of TGBL (face value of Rs 1 each) for every 4 shares of MEMW (face value of Rs 10 each). It will not create treasury stock as part of the merger.
Shares of TGBL were trading at Rs 146 each, down 5.66 per cent in a flat Mumbai market in mid-day on Wednesday.
The swap ratio was based on recommendation by independent valuers, SSPA & Co. and Haribhakti & Co. ICICI Securities and Rothschild have issued a fairness opinion on the swap ratio.
The appointed date of the merge scheme would be April 1, 2013.
TGBL also owns majority stake in another listed arm Tata Coffee Ltd.
(Edited by Joby Puthuparampil Johnson)