Extending its initial losses, shares of Jaiprakash Associates today lost nearly 12 per cent, after the Aditya Birla group company UltraTech Cement announced the acquisition of Jaypee Cement Corporation's (JCCL) Gujarat unit for Rs 3,800 crore.
The deal was announced post market hours yesterday.
After plunging 12.44 per cent to Rs 38 in intra-day trade, shares of Jaiprakash Associates Ltd finally ended at Rs 38.35, down 11.64 per cent from its previous close at the BSE, in an overall weak stock market.
Following the downtrend in the stock, the market value of the company plunged Rs 1,120 crore to Rs 8,510 crore.
On the other hand, UltraTech Cement's scrip ended the day on a flat note, up 0.16 per cent at Rs 1,735.
Jaypee Cement Corporation Limited (JCCL) is a wholly owned subsidiary of Jaiprakash Associates.
The deal, to be completed in seven to nine months, will further cement UltraTech Cement's numero uno position in the market and give it an entry into Gujarat. For the Jaypee Group, it will help pare a portion of its Rs 55,000 crore debt.
The acquisition will be funded through equity of Rs 150 crore, debt worth Rs 2,000 crore and the remainder of Rs 1,650 crore through internal accruals. Jaypee Cement had Rs 350 crore of carry forward losses.
Infra major Jaypee Group had said the sale of the Gujarat cement plant will reduce its debt by Rs 3,600 crore in the current financial year.
The BSE benchmark Sensex ended the day at 19,781.88, down 215.57 points.