RISING SUN HOLDINGS of ADAR POONAWALLA has tied up to purchase MAGMA FINCORP. The deal to buy the company has been done for 3456 crores rupees. After this deal, RISING STAR’s share will be 60 percent. The stock has almost doubled in the last 10 days.
Today, this stock saw a surge of more than 9% in the morning trading session. Let us know that Rising Sun Holdings is the company of Serum Institute of India CEO Adar Poonawalla. Magma Fincorp is a non-banking financial company.
The deal will be completed through preferential issue of equity shares of Rs 3456 crore of Magma Fincorp. Along with this, open offer will also be brought under SEBI rules.
The company’s official statement said that the agreement is subject to statutory approvals. Upon completion of this agreement, Rising Sun Holding’s stake in Magma Fincorp will be reduced to 60 per cent, while Magma Fincorp’s current promoter group stake will come down to 13.3 per cent. After the preferential issue under this agreement, the net worth of MFL will increase to around Rs 6300 crore.
Shares of MFL were trading around 93.40 around 9.40 pm indicating a gain of 9.95 per cent. In today’s trading session, the stock touched its 52-week high of 93.40. Rising Sun Holding will become the promoter of MFL after this preferential issue. MFL and its subsidiary companies will also be re-branding and renaming under the Punawala brand name.
After completion of these preferential allotments, it is proposed to merge Punawala Finance’s financial services business with MFL. This proposal is subject to the necessary statutory approvals.