Unilever pumps $3.2 bn into market to hike HUL stake to 67%
05 July 2013
Unilever plc has announced the closure of the open offer to buy back 487.0 million of the outstanding stock of Hindustan Unilever Ltd (HUL) after acquiring about 319.7 million (about 66 per cent) of the target.
With this, Unilever's stake in its Indian arm is estimated to have increased by a third to over 67 per cent.
At the offer price of Rs600 per share, the market transaction is valued at Rs19,180 crore ($3.18 billion or 2.45 billion euros), the company said in a release.
The open offer, which opened on 21 June closed at the close of trading on the bourses on 4 July.
Unilever has infused $3.18 billion into the capital market in a single transaction, amounting to about 30 per cent of the money foreign investors have pumped into domestic stocks so far this year.
The infusion, the largest buy-back on an Indian bourse, however, had only very little impact on the foreign exchange market with the Indian rupee gaining 9 paise to close at 60.13 against the US dollar on Thursday.
HUL stock, however, gained with the stock rising 1.2 per cent in afternoon trade, having earlier hit a record Rs632.
Shares of HUL have risen nearly 21 per cent since the announcement of the offer on 30 April. On Thursday, the stock ended at Rs600.75, up 2.27 per cent, just above the offer price.
HUL's major public shareholders include LIC (3.22 per cent stake), Oppenheimer Developing Markets Fund (1.76 per cent) and Virtus Emerging Markets Opportunities Fund (1.44 per cent).
''We are pleased to have received such a good response to our voluntary open offer and that – as a result – we will significantly increase our stake in Hindustan Unilever, an excellent Indian business with a proud heritage and the potential for attractive long-term growth,'' Paul Polman, CEO of Unilever, said.
Unilever expects payment for shares tendered and accepted to be completed on or before 18 July.