Stocks in News - 24 June 2009

Courtesy : Moneycontrol

Suzlon looking to exit Hansen: Sources

Suzlon Energy may be looking to exit its European subsidiary Hansen. The wind turbine power giant has been learnt to be in advanced talks with a European firm to sell its entire 61% stake for around USD 1.3 billion. CNBC-TV18’s Nimesh Shah reports why the Tulsi Tanti-promoted Suzlon is wanting to sell of its assets.

Even as it surprises most investment bankers, it is learnt from reliable sources that Suzlon may put up its entire 61% stake in Hansen on the block and may sell it for about USD 1.1–USD 1.3 billion. The deal may be announced as soon as this weekend — perhaps with the company’s results, sources say.

Suzlon, in an official communication to the London Stock Exchange on Jun 15, said, “Suzlon is evaluating every options for their holding in Hansen and the talks may lead to disposal of part or entire stake in Hansen”. However, in a statement to CNBC, it said it would not offer any comment on market speculation. The deal is under the observation of the takeover panel in London.

Analysts who track the company are surprised with the development as Hansen, the company they bough in 2006 for USD 556 million, is a good value-add for Suzlon. Hansen’s presence also bodes well for Suzlon’s other subsidiary, REpower. The deal value is USD 1.1–USD 1.3 billion, which means it is valuing Hansen at an enterprise value of close to USD 1.8 to USD 2.1 billion. Hansen trades on the London Stock Exchange at a market cap of USD 1.5 billion — Suzlon is getting a price of more than what the current market cap is, even as it may lose what analysts say is an important strategic fit.