Sterlite Industries (SLT) Higher On Divestment Talks
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Shares of Sterlite Industries India Limited (ADR) (NYSE: SLT) are trading at new high level today, on speculation that the Company could sell a stake in its business. Specifically, several sources close to the matter said Sterlite could be considering selling part of its energy arm for as much as $2 billion in order to raise capital to build power plants.
According to the rumors, which were reported on Bloomberg, the largest producer of copper in India would sell about 15% of its Mumbai-based Sterlite Energy Ltd. and build more power plants as government officials are begin to invest heavily in power. All across India, power shortages cause numerous yearly blackouts, certainly stunting economic growth.
Sterlite has already proven this technique can be profitable as it raised about $1.75 billion in June and immediately invested the proceeds into its power unit, which in turn drove stock sales of Indian companies to a record high.
Furthermore, the sources said that the group may consider an IPO of Sterlite Energy after the sale of the 15% stake.
Sterlite stock is up more than 12% on the rumors today, recording its highest level since it went public at about $15 back in June. Shares went as high as $27.35 in early morning trading, showing unusually high volume, already approaching its average daily volume of about 3 million shares.
Sterlite Industries Limited is a non-ferrous metals and mining company. The Company is one of the custom copper smelters in India.
According to the rumors, which were reported on Bloomberg, the largest producer of copper in India would sell about 15% of its Mumbai-based Sterlite Energy Ltd. and build more power plants as government officials are begin to invest heavily in power. All across India, power shortages cause numerous yearly blackouts, certainly stunting economic growth.
Sterlite has already proven this technique can be profitable as it raised about $1.75 billion in June and immediately invested the proceeds into its power unit, which in turn drove stock sales of Indian companies to a record high.
Furthermore, the sources said that the group may consider an IPO of Sterlite Energy after the sale of the 15% stake.
Sterlite stock is up more than 12% on the rumors today, recording its highest level since it went public at about $15 back in June. Shares went as high as $27.35 in early morning trading, showing unusually high volume, already approaching its average daily volume of about 3 million shares.
Sterlite Industries Limited is a non-ferrous metals and mining company. The Company is one of the custom copper smelters in India.
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