Shares of Sterling and Wilson Solar (SWSL) rallied 17 per cent to hit a 52-week high of Rs 509 on the BSE in Monday’s intra-day trade after the company announced on Sunday that Reliance Industries (RIL) through its subsidiary will acquire a 40 per cent stake in the company through a combination of primary investment, secondary purchase and open offer for around Rs 2,850 crore.
“Reliance New Energy Solar (RNESL), a wholly-owned subsidiary of RIL, executed definitive agreements with Shapoorji Pallonji and Company Private Ltd (SPCPL), Khurshed Daruvala and SWSL to acquire 40 per cent stake post-money in SWSL through a series of the transactions,” SWSL said in a release.
RIL will first acquire 15 per cent in SWSL by way of a preferential allotment of 29.3 million equity shares (equivalent to 15.46 per cent post preferential share capital) at Rs 375 per share. RIL will also acquire 18.4 million equity shares by RNESL from SP group company (equivalent to 9.7 per cent post preferential share capital) at a price of Rs 375 per share. This will cost RIL about Rs 1,100 crore.
The company will also acquire a 25.9 per cent stake by way of an open offer at the same price. But as the current market price of S&W Solar is Rs 435 a share, the shareholders may not tender shares at the offer price. RNESL will hold 40 per cent of the equity capital of SWSL, consequent to acquisition in the open offer.
The transaction is subject to customary regulatory and other approvals and closing conditions.
SWSL, a Shapoorji Pallonji Group company, is a global pure-play, end-to-end solar engineering, procurement, construction (EPC) solutions provider. It provides EPC services primarily for utility-scale solar power projects, with a focus on project design and engineering, and manages all aspects of project execution from conceptualisation to commissioning.
At 10:13 am, the stock was trading 11 per cent higher at Rs 483 on the BSE, as compared to a 0.29 per cent rise in the S&P BSE Sensex. The trading volumes on the counter more than doubled with a combined 12.56 million equity shares having changed hands on the NSE and BSE.