The entry into the rolling settlement mode resulted in a 20 per cent jump in the share price of CMC Ltd today. The stock closed higher at Rs 364.05 on the Bombay Stock Exchange (BSE) today, up from an intra-day low of Rs 315.
Dealers said CMC shares remained firm as market players accumulated the scrip on hopes of another open offer. The development comes close on the heels of Tata Sons' open offer for the outstanding 16.69 per cent non-government holding, which closed on December 26.
CMC was in action on the back of talks of a $5 million order to process the census data, dealers said. The rise in the stock price over the last few days has been accompanied by high volumes.
As against a mere 95 shares of CMC that were traded on October 31, 2001, volumes at the counter today were 91,980 shares. The stock has rose by 32.85 per cent from Rs 274.25 on October 31, 2001.
At today's price of Rs 324.55, the stock is quoting at a 29.53 per cent premium over the offer price of Rs 281.26 made by Tata Sons to the public shareholders of the company.
The offer opened on November 27 and closed on December 26, 2001. Sources said that market players had been accumulating the stock to boost prices so as to make the open offer unattractive, and were successful in doing so, given the fact that the open offer attracted less than 1 per cent subscription.
A share purchase agreement was signed on October 9, 2001, between the Government of India and Tata Sons, whereby the government sold 77,26,500 equity shares of Rs 10 each representing 51 per cent of the paid-up equity share capital of the company to Tata Sons.
The government's 83.31 per cent stake in CMC has now come down to 32.3 per cent. Tata Sons acquired the 51 per cent stake for Rs 152 crore (Rs 196.7 per share). Following the acquisition, Tata Sons made an open offer to acquire an additional 16.69 per cent stake at Rs 281.26 per share.
