Swiss Engineering company ABB has successfully acquired 75% stake in Indian unit - ABB's open offer has got over subscribed, report CNBC-TV18, quoting sources. LIC and ICICI Prudential life tendered a part of their holding in the offer. Wherein, LIC tendered 50% of its holding and ICICI Prudential tendered 70%. ABB open offer was for 23% stake at Rs 900 per share.
Now ABB (Parent) holds much larger stake in the Indian subsidiary and it gives them better management control too. We don't know yet if the parent wants to delist the company from India after buying remaining 25% stake too in the future but now that looks like only trigger if price has to move up.
Stock of ABB may not perform going ahead as poor performance continues - ABB Ltd India suffered a second-quarter net profit decline of 54 per cent year-on-year to Rs 38.3 crore (Rs 83.60 crore). The power and automation technologies major attributed the fall to increased pressure on pricing and continued costs on exit from the rural electrification business. Sales revenue dipped nearly 4 per cent to Rs 1,446 crore year-on-year (Rs 1,505 crore) on account of delayed orders worth Rs 8,531 crore for the first six months ended June. The latest quarter saw orders worth nearly Rs 1,235 crore.
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