OPEN APP
Home / Companies / News /  Rakesh Jhunjhunwala portfolio stock surges as Japanese partner to hike stake
Listen to this article

Shares of Escorts were trading over 8% higher on the BSE in Thursday's early deals, witnessing a sharp surge after Japan's Kubota announced that it will increase its shareholding in India's leading tractor manufacturing company.

Kubota Corporation announced that Kubota and Escorts Limited (EL) have reached an agreement under which Kubota will increase its shareholding in EL by March 31, 2022 by means of subscription to third-party preferential primary share allotment and open offer bid.  

Escorts will issue 93,63,726 equity shares of face value of 10 each at a price of 2,000 per equity share to Kubota on preferential basis. Post completion of the open offer and issue becoming effective, Kubota will become a joint promoter of the company along with the existing promoters.

Kubota corporation holds 9.09% stake in the company as of September 2021. Post preferential allotment, the Japanese partner's investment in the company be 14.99%, it said. Kubota will also make an open offer to the public shareholders of Escorts to acquire upto 26% of the share capital. Current promoter group (Nanda family) are not selling any shares of the company, Escorts said.

"Kubota has decided to increase its shareholding in EL, based on expectations for the basic tractor market to expand in emerging countries including India. In addition, the management has also considered such investment as the best way for Kubota to utilize combined resources in an effective manner and further strengthen the partnership between the two companies," Japan's agricultural machinery company said in a statement.

As per BSE shareholding pattern, ace investor Rakesh Jhunjhunwala holds 4.75% stake in Escorts as of September 2021.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.
Close
Recommended For You
×
Edit Profile
Get alerts on WhatsApp
Set Preferences My ReadsFeedbackRedeem a Gift CardLogout