Shares of Wockhardt Ltd today surged as much as 5 per cent on the Bombay Stock Exchange on reports the drug maker is looking for buyers for its two subsidiaries in a bid to repay its debt to investors.
The scrip surged as much as 5.56 per cent over its previous closing price and touched an intra-day high of Rs 110 on the BSE. Later, it parted with some gains and was trading at Rs 106.40, up 2.11 per cent on the BSE.
Meanwhile, the pharma firm in a regulatory filing said that "it is the company policy not to comment on market speculations." The filing further added that "appropriate disclosures will be made in case the company plans to divest the subsidiaries and enters into definitive agreement."
The Mumbai-based pharma company needs money to redeem its foreign currency convertible bonds (FCCBs) which come up for repayment in October next year, the report added.
Another report relating to a Wockhardt group firm, Wockhardt Hospitals, considering merger with Manipal Hospitals and a possible stake-sale to Fortis Healthcare, also encouraged investor sentiment as the move would infuse funds into the company.
Meanwhile, Fortis Healthcare also soared 7.94 per cent over its last close to touch an intra-day high of Rs 76.05. The stock was later trading at Rs 70.60, up 0.21 per cent on the BSE.
Marketmen said the deal is a win-win situation as it would help infuse much needed funds in Wockhardt Hospitals while giving majority shareholding to Fortis and this is being reflected in the stock movement of both the companies.
According to reports Fortis Healthcare might infuse $100 million for a majority stake in Wockhardt Hospitals. While the final shape of the deal is yet to be finalised, the deal might involve a merger of Wockhardt and Manipal. In a separate regulatory filing Wockhardt said it will raise up to Rs 500 crore through issue of preference shares. The company's shareholders would meet on January 19 to consider issuance of redeemable preference shares with a face value of Rs 5 each. Besides, the company would increase its authorised share capital to Rs 175 crore from the existing Rs 125 crore through issue of 10 crore preference shares, the filing added.
