BOMBAY (AFX-ASIA) – Reliance Industries Ltd said it is making an open offer to acquire a fresh 20% stake in power company BSES Ltd, in a move that will cost the group around 7.43 billion rupees. (US$1=50 rupee).
Reliance already has a 43.4% stake in BSES, which is a leading power generation and distribution company and a key supplier of electricity in Bombay, the country’s financial hub.
The open offer for BSES public shareholders is planned at a price of 230.10 rupees per share. BSES stock closed at 225.20 rupees on the Bombay Stock Exchange last week.
A statement said the open offer, which begins January 17 and closes on February 15, will cost the group around 7.43 billion rupees.
“We believe this step is in the best interests of both the companies and will significantly contribute to the enhancement of the overall shareholder value for Reliance and BSES,” said Reliance vice chairman Anil Ambani.
This is the second open offer from Reliance for BSES. The first was in May 2000 when it acquired a 30% stake.
Reliance sees BSES as a vehicle for the group’s future investments in the country’s power sector.
Earlier this year Reliance chairman Mukesh Ambani said the group intended to raise its stake in BSES to at least 51%.