Ashok Leyland shares slipped over 4 per cent in the early trade on Thursday after the company informed bourses that the board of directors on September 14 have approved the Scheme of Amalgamation of Hinduja Foundries with the company. At 10.46 am, shares of Ashok Leyland were trading 3.78 per cent down at Rs 81.35. The scrip opened the day at Rs 82.90 and has touched a high and low of Rs 83 and Rs 80.90, respectively, in trade so far. Later, Hinduja Foundries closed 19.93 per cent down at Rs 44 and Ashok Leyland ended 3.55 per cent down at Rs 81.55.
The board also approved the share exchange ratio of 100 equity shares of Rs 10 of Hinduja Foundries will get 40 equity shares of Re 1 of Ashok Leyland and one thousand (1,000) 2008 series GDRs of Hinduja Foundries will receive 133 equity shares of Ashok Leyland. The company’s board also said that 1 (one) 2016 series GDRs of Hinduja Foundries will get 4,800 equity shares of Rs 1 each fully paid of Ashok Leyland and the appointed date for the proposed amalgamation is October 1, 2016.
Shares of Hinduja Foundries breached lower circuit after the announcement. The scrip plunged 19.93 per cent to Rs 44 in the early trade. Ashok Leyland and Hinduja Foundries belong to Hinduja Group, but both of them are not related parties.
Hinduja Foundries is engaged in the business of grey iron castings and supply of automotive components and Ashok Leyland is engaged in the business of manufacture and sale of commercial and defence vehicles and power solutions.