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Sona BLW share price tanks over 3% after Blackstone stake sale report; details here

Sona BLW share price tanks over 3% after Blackstone stake sale report; details here

Blackstone Inc. is selling its shares in Indian automotive component maker Sona Comstar, according to a report in Bloomberg News. The deal will reportedly bring in Rs 3,180 crore ($400 million). An affiliate of the US firm is offering shares in Sona BLW Precision Forgings Ltd, as Sona Comstar is formally known, at Rs 500 per equity. This is a discount of 7.2 percent on Wednesday’s closing price. The shares on sale amount to 79.43 million shares, or 13.6 percent stake in Sona Comstar.

The shares of Sona Comstar fell on Thursday, 18 August, after the news broke. According to data from the Bombay Stock Exchange, the shares of Sona BLW Precision Forgings Ltd fell over 3 percent and were priced at Rs 522.50 at 12:30 pm.

The shares on NSE tanked similarly and were priced at Rs 522. 40, down by 3.10 percent. After the news of Blackstone Inc selling its stake broke, Sona Comstar's shares opened lower at Rs 521.60 on the NSE. The stock then fell to its lowest level on the exchanges since September last year, but rallied on the back some buying at lows.

According to Bloomberg, if the response from buyers is good, Blackstone could raise the offer to Rs 3,970 crore. The booking for the shares closes on Thursday. The Indian unit of Nomura Holdings Inc. is the placement agent of the deal. The Blackstone-controlled entity has a stake of 34.1 percent in Sona Comstar.

The Initial Public Offering of Sona Comstar took place last year and raised about $776 million for the company.

Sona Comstar had earlier announced that it was partnering with Israel-based innovation hub Drive TLV for smart mobility solutions. According to a press release by the company, the partnership would give Sona Comstar the chance to access Israel's high-tech mobility start-up ecosystem. The Indian automotive component maker would also get a chance to participate in Drive’s commercialization programme, FASTLANE. Further, it will have access to POWER, the new testing, evaluation and development centre by Drive.

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