CG Power and Industrial Solutions shares hit an upper circuit band of 5 per cent at Rs 15.69 apiece on the Bombay Stock Exchange (BSE) on Tuesday after private equity firm KKR India acquired nearly 10 per cent stake in the company for over Rs 89 crore through open market transactions.
According to bulk deal data available on stock exchange, KKR India Debt Opportunities Fund II and KKR India Financial Services have picked up over 6.26 crore shares, or around 10 per cent, in CG Power, from Vistra ITCL (India) Ltd.
"KKR India Financial Services Ltd and KKR India Debt Opportunities Fund II have, in exercise of their rights in respect of credit facilities extended to Avantha Holdings Ltd and its subsidiary Salient Financial Solutions Ltd and through the enforcement of pledges created by Avantha Holdings Ltd, respectively, acquired 50,736,588 and 11,938,021 equity shares of CG Power and Industrial Solutions Ltd through a transaction on the stock exchange," the PE firm said on Monday.
Boosted by the development, share price of CG Power and Industrial Solutions gained as much as 4.95 per cent to settle at Rs 15.69 apiece against the previous close of Rs 14.95 on the BSE. The stock has gained nearly 90 per cent from its 52-week low of Rs 8.3 apiece touched on August 27.
There was surge in volume trade as a total of 5.41 lakh shares changed hands on the BSE as compared to two-week average volume of 2.16 lakh shares.
In a similar fashion, stocks of CG Power ended 4.68 per cent higher at Rs 15.65 on the National Stock Exchange. The scrip opened higher at Rs 15.65 against previous close level of Rs 14.95.
The company's share has witnessed hefty selling in the recent past as reports of financial irregularities, unauthorised and undisclosed transactions eroded investor sentiments. CG Power shares have plunged nearly 72 per cent from its 52-week high of Rs 55.
Last week, the company's CEO KN Neelkant had resigned from all subsidiaries of the company after investors and lenders questioned his continuance and mounted pressure for his ouster for the alleged irregularities happening under his watch.
On August 29, the board of CG Power & Industrial Solutions had removed its founder Gautam Thapar as chairman after an investigation unearthed a multi-crore financial scam in the firm. Later, the CG Power board also sacked the firm's CFO V R Venkatesh over alleged "misconduct" and breach of trust. In the wake of the scam, CG Power's financial damage is estimated to be more than Rs 3,000 crore.
Edited by Chitranjan Kumar