Foseco India Shares Hit Record High On Morganite Crucible Acquisition

Foseco will acquire 42 lakh equity shares of MCIL at ₹1,557 per share, for a total consideration of ₹653.94 crore.

Foseco India surged to record highs on Friday, after the company announced an agreement to acquire a majority stake in Morganite Crucible (India).

According to a press release dated August 22, Foseco India entered into a share purchase agreement to acquire a 75% stake in Morganite Crucible India (MCIL). Under the agreement, Foseco will purchase 42 lakh equity shares of MCIL at a price of ₹1,557 per share, amounting to a total consideration of ₹653.94 crore.

The acquisition marks an important step in expanding Foseco’s market share in crucible materials. Morganite Crucible (India) manufactures and sells silicon carbide, clay graphite crucibles, and their accessories.

The payment will be made through the issuance and allotment of 11.51 lakh shares of the company, valued at ₹5,674 per share, to MCIL’s promoters via preferential allotment, representing 15.27% of Foseco’s total share capital.

Following the completion of the transaction, Foseco will gain control of MCIL and will launch an open offer to acquire an additional 14 lakh equity shares, representing 25% of MCIL’s share capital at ₹1,557.15 per share. The open offer would amount to ₹218 crore.

Retail Bullish

Retail sentiment on Stocktwits was ‘bullish’. It was ‘neutral’ a week earlier.

At the time of writing, Foseco shares were up 13.8% to ₹6,380.

The stock has been on a strong run this year, gaining more than 56%.

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