RNRL and RPower Merger Ratio Decided as 4:1

by khalid on 05/07/2010 · 2 comments

The two Anil Dhirubhai Ambani Group (ADAG) company Reliance Natural Resources (RNRL) and Reliance Power (RPower) will merge in a ratio of 4:1. After the merger, shareholder of RNRL will get one share of RPower for every four shares of RNRL held on the record date which will be announced later. Board of Directors Meeting of the ADAG Group was haeld om 4th July 2010 and they decided the above merger. The merger is subject to approvals from the shareholders of the two companies and also other regulatory nods. However, the exchange ratio will be based on valuations by KPMG. The completion of the merger could take about six months.

Post the transaction, RPower will have over 60 lakh shareholders, the largest number of shareholders for any firm in India. Given the share-swap ratio, market players expect RNRL’s scrip price to slide when trading resumes on Monday, while RPower shares could trade flat. On Friday, RPower stock on the BSE closed at Rs 175, up 3.3% over Thursday’s close, while RNRL, after an initial spurt, had finished the session at Rs 64, down 2%.

RNRL investors would be worried, as the ratio seems unfair, a 20% discount price from RNRL current Market price. The stock deal is pegged at over Rs500bn, says report.

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mushtaq October 9, 2010

i have 2500 shares of rnrl @67 what i wil do.

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khalid October 9, 2010

Hi Mushtaq
Out off your 2500 shares of RNRL, you will get 625 shares of RPower on record date.
khalid

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