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ITC shares slide as ITC Infotech eyes Happiest Minds stake
The planned acquisition is sized at 22.106% of Happiest Minds Technologies on a fully diluted basis, with an ensuing amalgamation exchange ratio of 25 ITC Infotech shares for every 81 Happiest Minds shares.
ITC shares turned lower after a period of steep underperformance, with the stock down sharply despite a brief early-session pop in the latest trading. According to LiveMint Markets, ITC shares opened at ₹261.50 on the NSE and quickly touched an intraday high of ₹267.50, but the broader move still leaves the company down over 25% year to date and about 35% over the past year.
The selling pressure is tied to a transaction disclosed by ITC, via its wholly owned subsidiary ITC Infotech. LiveMint Markets reports that ITC Infotech has received board approval to acquire 3,36,61,700 equity shares of Happiest Minds Technologies, representing 22.106% of its equity share capital on a fully diluted basis, from Happiest Minds promoter or promoter group, including Ashok Soota and Ashok Soota Medical Research LLP.
The plan also includes an amalgamation of Happiest Minds Technologies into ITC Infotech. LiveMint Markets says that once the amalgamation becomes effective, ITC Infotech will issue and allot 25 fully paid-up equity shares of ₹10 each for every 81 fully paid-up equity shares of ₹2 each held by Happiest Minds shareholders other than ITC Infotech, and it is proposed that ITC Infotech shares be listed on the BSE and the National Stock Exchange of India.
LiveMint Markets notes the transaction is subject to transaction documents and approvals, including approvals from the stock exchanges, the Competition Commission of India, and the National Company Law Tribunal. The shares also shed more than 7.5% over one month, over 15% over six months, more than 25% year to date, and around 35% in one year, highlighting the magnitude of recent declines.