Ambuja Cement remains amongst the top gainers on the BSE since morning, going up almost 10% to Rs.270.50, some Rs.12 away from its 52-week high of Rs.282. ACC in fact went on to hit a new high at Rs.1753.85, almost Rs.100 higher over Friday’s close of Rs.1655.
The reason for both these cement stocks to rise and shine today morning is the news that the merger plans, which were mooted way back in 2013 might finally take off.
The Boards of both the companies have announced that they are indeed exploring the possibility of a merger. A special committee of directors, comprising largely of independent directors, has been constituted to commence the evaluation.
JM Financial has put out a report stating, “the current Ambuja-ACC swap ratio is 6.7x while six month average has been 6.3x. A swap ratio of less than 7x will ensure promoter shareholding of greater than 50%. Based on our analysis, realisation of merger synergies will present a 15-20% upside in Ambuja from current levels.”