(Rs 131, FY08E - P/E - 6x, BUY, Target Price Rs 215)
De-merger/Merger –Gets court Approval
The Hon’ble High Court of Andhra Pradesh has allowed and approved the scheme of arrangement between the company and M/s Sujana Towers Ltd and Amalgamation of M/s Sujana Steels Ltd with the company on 10th April’07. The proposed de-merger will be effected with retrospective effect from July’2006.
The scheme of arrangement between Sujana Metal Products Ltd (SMPL) and Sujana Towers Ltd (STL) and the amalgamation of Sujana Steels Ltd (SSL) with SMPL will help the company to derive the true value of the company which at present is undervalued.The current paid up equity share capital is Rs 388.3 mn of SMPL consisting of 38.83 mn equity shares of Rs 10 each which will be split equally between STL and SMPL. Simultaneously, the face value of equity shares of STL and residual SMPL will be reduced to Rs 5 paid up shares each. Each shareholder will get one share of Sujana Towers Ltd and Sujana Metals Ltd for holding one share of Sujana Metals ltd (present company).
The Hon’ble High Court of Andhra Pradesh has allowed and approved the scheme of arrangement between the company and M/s Sujana Towers Ltd and Amalgamation of M/s Sujana Steels Ltd with the company on 10th April’07. The proposed de-merger will be effected with retrospective effect from July’2006.
The scheme of arrangement between Sujana Metal Products Ltd (SMPL) and Sujana Towers Ltd (STL) and the amalgamation of Sujana Steels Ltd (SSL) with SMPL will help the company to derive the true value of the company which at present is undervalued.The current paid up equity share capital is Rs 388.3 mn of SMPL consisting of 38.83 mn equity shares of Rs 10 each which will be split equally between STL and SMPL. Simultaneously, the face value of equity shares of STL and residual SMPL will be reduced to Rs 5 paid up shares each. Each shareholder will get one share of Sujana Towers Ltd and Sujana Metals Ltd for holding one share of Sujana Metals ltd (present company).
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