Reliance Power RNRL Merger

July 4, 2010 - PRLog -- Read about the press article here. Reliance power and natural are really good stocks.

"Kalpataru builders has signed an agreement to buy 4.5 acres of land in Mulund that belongs to Schrader Duncan Ltd, a leading manufacturer of tyre tube valves and accessories," the source close to development said.

http://birlaa.com/2010/07/02/rnrl-reliance-power-merger-reliance-natural/


The land owner, Schrader Duncan Ltd, had shifted its automotive plant from Mulund to Ranjangaon, in Pune, in 2009, where commercial production has already started.

Before that, the company had shifted its pneumatic division from Mulund to Mhape, in Navi Mumbai.

RNRL shareholders, including promoters, will get R-Power shares worth about Rs 7,150 crore, as per the current market prices. Out of these, the promoters would get shares worth over Rs 3,600 crore.

"In terms of business value, the merger deal is good for RNRL... (who) will have more share in ADAG's power projects. Till present, the scrip is more like a trading firm, but post-merger, its value will grow," Angel Broking Vice-President, Research, Sarabjit Kour Nangra said.

However, some analysts said the deal value is not so lucrative for RNRL shareholders and will be sweet only after the share price of R-Power breaches the combined value of four shares of RNRL.

"RNRL shareholders would have been at better position if the share exchange ratio value was more sweet," said a broker on the condition of anonymity.

The current valuation pegs the market cap of the combined entity at over Rs 52,000 crore. At the end of Friday's trade, the market cap of R-Power stood at Rs 41,979 crore and of RNRL at Rs 10,394 crore.

In a Rs 50,000-crore mega deal, the Anil Ambani Group today announced the merger of RNRL with Reliance Power, which will now become a direct beneficiary of the gas deal signed with Mukesh Ambani-led Reliance Industries.