Welspun Projects Ltd has entered into an agreement with Leighton Welspun Contractors Pvt Ltd (LWC) to transfer 72 per cent EPC (engineering, procurement and construction) order book of the company to LWC through an all-stock deal. The value of the deal is pegged at Rs 115 crore ($20.85 million), according to a BSE filing.
As part of the deal, LWC will issue 11,503,485 equity shares of Rs 10 each, comprising 7.5 per cent of the post-issued share capital of LWC to public-listed Welspun Projects.
Welspun Projects scrip shot up 5.9 per cent to close at Rs 11.42 a share on the BSE in a strong Mumbai market. The company has a market cap of just Rs 45 crore.
Founded in 1994, Gujarat-based Welspun Projects (formerly MSK Projects India Ltd) is a $3.5 billion company engaged in the EPC business.
In April 2011, Welspun Infra Projects Pvt Ltd, a wholly owned subsidiary of the Welspun Group, acquired 35 per cent stake in Mumbai-based Leighton Contractors India Pvt Ltd from Leighton Holdings Ltd, for $104 million. Post transaction, Leighton Contractors India became Leighton Welspun Contractors Pvt Ltd. Mumbai-based LWC is engaged in infrastructure development, property development, building construction and contract mining.
Leighton Group is one of the world’s largest EPC and contract mining organisations, and it started its operations in India back in 1998.
(Edited by Sanghamitra Mandal)