Prabhat Dairy hits 52-week low as firm to sell milk business to Lactalis

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New Delhi, January 26, 2019:  Shares of hit a 52-week low of Rs 78.15, declining 16 per cent from its previous close, and crashing 30 per cent from its intra-day high on the National Stock Exchange (NSE) after the company announced that global dairy major will buy its  The stock had rallied 20 per cent to Rs 111 on the in early morning trade.

“The company has entered into definitive agreements with Tirumala Milk Products Private Limited, a wholly owned subsidiary of French dairy multinational Groupe Lactalis, for the sale of its for a consideration of Rs 1,700 crore,” said in a statement on Monday after market hours.

The transaction involves the sale of the undertaking of by way of slump sale on a going concern basis, along with the sale of 100 per cent shareholding in Sunfresh Agro Industries Private Limited (a step-down subsidiary of Prabhat Dairy) via a share purchase agreement, it added. The transaction is subject to mandatory approvals.

Prabhat Dairy said that it intends to share a substantial portion of the proceeds from the sale with shareholders after meeting its tax and transaction cost obligations according to business-standard.com.

After closing of the transaction Prabhat Dairy intends to further develop its cattle feed business in various parts of the country, as well as expand into allied businesses such as animal nutrition and animal genetics.

Prabhat Dairy made a stock market debut on September 21, 2015. It hit an all-time high of Rs 241 on January 24, 2018 in intra-day deal. The stock was trading 32 per cent below its issue price of Rs 115 per share.

The stock, eventually, ended the day at Rs 79.75, down over 14 per cent on  In comparison, the S&P ended 134 points or 0.37 per cent lower at 36,445.

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