Block deals to watchout on Tuesday: HDFC AMC, Timken likely to see large trade
Two major block deals that traders need to watch out for on Tuesday. UK’s largest active asset manager, Abrdn Investment Management is likely to offload its entire shareholding worth ₹3,920.1 crore ($478 million) in HDFC Asset Management Company (AMC). Furthermore, Timken Singapore Pte may sell equity shares to the tune of ₹1,890 crore in Timken India. BofA Securities is the sole book runner for both transactions.
HDFC AMC:
Abrdn Investment Management will sell 21.778 million shares or its entire 10.2% holding in HDFC AMC. The floor price for the transaction is in the range of ₹1,800 to ₹1,892.45 per share — which is nearly a 5% discount from the current market price.
In December last year, Abrdn had expressed its intention to sell the entire 10.21% stake in HDFC AMC.
Based on the lower end of the price range, Abrdn will sell equity shares worth ₹3,920.1 crore or $478 million in HDFC AMC.
As per the statement, no guidance will be given on pricing until the shares are crossed on the stock exchange on 20th June 2023. Investors should indicate the demand sensitivities across the price range.
Also, there is no assurance that any order for shares will be met in part or full, principally due to the operational mechanics and the screen-based trading mechanism of the Indian stock exchanges.
The expected trade date is June 20, 2023, while the settlement date is June 21st.
Timken India:
Industrial products manufacturer, Timken Singapore Pte Ltd will be selling 6.3 million shares or 8.4% of existing holding in Timken India. This is the base offer.
The floor price was the block deal is set at ₹3,000 per share — which is a 14% discount from the current market price.
Based on the floor price, the transaction is expected to value around ₹1,890 crore or $231 million.
There is a lock-up period of 90 days on the seller.
Just like HDFC AMC, the large deal is expected to take place on June 20th, and the settlement date is on June 21st.
Here as well, no guidance will be given on pricing until the shares are crossed on the stock exchange on 20th June 2023. Also, there is no assurance that any order for shares will be met in part or full.
BofA Securities is acting as the sole book runner for the block deal in both HDFC AMC and Timken India. There are also brokerage commissions and other charges such as 25 bps paid by the buyer and additional normal market charges.
On BSE, HDFC AMC’s stock price closed at ₹1891.10 apiece, down by ₹27.50 or 1.43% on Monday. While Timken India’s stock ended at ₹3485.50 apiece, lower by ₹8.90 or 0.25% on the same exchange.
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Updated: 19 Jun 2023, 11:04 PM IST