Shares of Tata Group firm Indian Hotels rose about 3 per cent today after luxury hotels chain Orient-Express rejected its $1.86-billion buyout offer.
Paring initial losses, Indian Hotels’ stock bounced back and moved up 2.67 per cent to Rs 65.20 on the BSE on a day when the BSE benchmark index Sensex is trading almost flat.
On the NSE, the scrip climbed 2.92 per cent to Rs 65.15.
“The buyout offer rejection is positive for Indian Hotels as investors were earlier worried that the acquisition would worsen the company’s debt profile and strain its balance sheet,” said Paras Bothra, Vice-President Research, Ashika Stock Broking.
Orient-Express had yesterday rejected the “unsolicited” $1.86-billion buyout offer from Indian Hotels, saying the bid significantly undervalues the company.
Indian Hotels had offered $12.63 per share in cash to acquire all the outstanding shares of Orient-Express. The $1.86-billion offer was made in October. This was the second takeover attempt by Indian Hotels, which holds about 7 per cent in Orient-Express.