Shares of Essar Ports and Essar Shipping rose by 15.19% to 17.97% at 10:41 IST on BSE after board of these companies approved delisting of shares from the stock exchanges.
Essar Shipping (up 17.97%) and Essar Ports (up 15.19%), edged higher.
The S&P BSE Sensex was down 154.13 points, or 0.59% at 26,143.25.
Essar Group is planning to delist two of its unitsEssar Shipping and Essar Portsfrom the bourses citing lack of investor appetite and the promoter group's need for increased flexibility. Both companies will seek the consent of the shareholders for the delisting proposal through a postal ballot and e-voting.
In a filing to BSE, Essar Ports said it has received a delisting approval from its board. The promoter group collectively owns 74.97% stake in Essar Ports (as on 30 June 2014).
The promoters believe that the delisting of the share of Essar Ports from the stock exchanges would provide the promoter group increased flexibility to support the business and financial needs of the company and enable them to optimally fund the growth initiatives of the company.
In a separate filing, Essar Shipping said the board of directors has granted approval for a proposal to voluntarily delist the equity shares of the company held by Essar Shipping and Logistics. The promoter group holds 75% of the stake in the company, while 25% is held by public (as on 30 June 2014).
In its filing, Essar Shipping said the promoter believes that there is a general lack of investor appetite in the sector in which the company operates for various reasons including slowdown in freight market, cyclical nature of the industry etc. The promoter believes that the delisting offer is in the interest of the public shareholders as it will provide them an exit opportunity from the company at a price determined by the prescribed regulations.
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