Shares of Widia India hit the 20 per cent upper circuit today on rumours that the company might be going in for a buy-back at Rs 265 per share.
On the Bombay Stock Exchange, the scrip opened at Rs 102.75 and closed at the circuit at Rs 123.30, with 71,763 shares being traded. On the National Stock Exchange, the scrip opened at Rs 101, and finished at the circuit at Rs 120.25 with 58,733 shares being traded.
Last month US-based Kennametal Inc signed an agreement to buy out the Widia group in Europe and India from Milacron Inc for $170 million. With this acquisition, Kennametal will have a stake of 51 per cent stake in Widia India. It also consolidates the US company's presence in the Asia Pacific.
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Under Sebi regulations, Kennametal will mandatorily have to make a 20 per cent open offer for Widia India since the acquisition results in a change in management. Kennametal operates in India through a joint venture, Birla Kennametal.
Widia India, which has an annual turnover of Rs 250 crore, manufactures carbide-cutting tools and has a market share of 43 per cent.
Widia India, which was incorporated in 1966 in collaboration with Meturit AG, a wholly-owned subsidiary of Widia GmbH, Germany, became part of the Milacron group after Cincinnati Milacron Inc acquired a majority stake in Widia, Germany in 1994.