DHL offers up to Rs550 per share to de-list Blue Dart

17 August 2006

DHL Express, one of the largest global players in the express freight industry, would buy out the remaining public shareholders of domestic express freight services major Blue Dart and de-list the company from the stock exchanges. The offer, through the reverse book-building route, would be made by DHL Express, Singapore.

As per the SEBI guidelines on the reverse book building process, the acquirer is required to offer a reserve price which is not less than the average stock price for the 26 weeks prior to the public announcement of such offer. Based on these guidelines, the reserve price would work out to around Rs500 per share.

DHL is offering a price of up to Rs550 per equity share of Blue Dart. Shareholders are free to tender their shares at a higher price, but DHL is reserving the right not to acquire the shares if the final discovered price is above Rs550.

The board of Blue Dart met today to consider the proposal from DHL and have decided to recommend it to the shareholders. An extra-ordinary general meeting of the shareholders would be held at a future date to seek approval for the proposal.

The Blue Dart stock opened at Rs605 on the NSE and surged to a high of Rs655 before the announcement about the offer price. The stock has declined considerably from those levels as the offer price is below expectations. The stock is now trading at Rs565, down 4.27 per cent from yesterday's closing price of Rs590.