GP Goenka sells Andhra Cements to Jaypee Group for Rs 235 crore


Updated Wed, 23 Nov 2011 00:00:00 GMT

The G P Goenka Group today sold its controlling stake in ailing Andhra Cements to Jaypee Group in an all cash deal of Rs 235 crore.

Goenka group will sell its 32.95 per cent promoter's stake, out of 45 per cent it held. Jaypee Development Corp will also subscribe to additional fresh issue of 14.75 crore shares through preferential allotment.

These will take Jaypee's stake in Andhra Cements to to 66.64 per cent, Andhra Cements informed the exchanges today.

The preferential allotment will be at Rs 12 a share of Rs 10 each. At this price, Jaypee Development Corp will have to fork out Rs 234.74 crore to acquire 66.64 per cent.

Jaypee will launch an open offer for 7.63 crore shares of Andhra Cements.

Shares of Andhra Cements closed 4.30 per cent down at Rs 10.46 on the BSE.

Andhra Cements incurred a loss of Rs 35.50 crore on net sale of Rs 65.48 crore last year while two of its units have been non-operational since June 2010. Andhra Cements had accumulated losses of over Rs 200 crore in the past two years.

Financial institutions such as JP Morgan, ICICI Bank, HDFC and IDFC have a combined holding of 37 per cent (non-expanded capital).