Route Mobile shares dive 16% from 52-week high; promoters stake sale in focus

Shares of Route Mobile Ltd fell sharply in Monday's trade after scaling their 52-week high level. The stock surged to its one-high price of Rs 1,759.50 in early trade after the company announced that Belgium-based telecom service provider Proximus Group would pick a majority stake in it. However, it later dived 16.25 per cent from day's high to hit a low price of Rs 1,473.60 as the session progressed.

Proximus would buy a 57.56 per cent stake in Route Mobile, for Rs 5,922.40 crore, the company said in an exchange filing. The Belgian firm stated that it would pay Rs 1,626.40 per share for the cloud communications platform provider.

The company said that the acquisition of the majority stake would trigger a mandatory takeover offer (MTO), in accordance with Indian regulations, for up to 26 per cent of the total shares outstanding of Route Mobile at the same price per share.

Depending on the outcome of the MTO, the stake held by Proximus could further increase to around 75 per cent. The cash consideration for the same would be determined by the effective MTO take-up.

The acquisition and MTO will be followed by a reinvestment of €299.6 million by some of the founding shareholders of Route Mobile for up to 14.50 per cent of the shares of Proximus. "The reinvestment by some of the founding shareholders of Route Mobile implicitly values Telesign at €1.4 billion. Taking into account the reinvestment, the net cash consideration for Proximus prior to MTO amounts to €∼343.4 million," it said.

On BSE, around 1.77 lakh shares changed hands today, which was way more than the two-week average volume of 16,000 shares. Turnover on the counter stood at Rs 28.48 crore, commanding a market capitalisation (m-cap) of Rs 9,366.79 crore.

The counter's 14-day relative strength index (RSI) came at 40.49. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-earnings (P/E) ratio of 112.95 against a price-to-book (P/B) value of 9.01. The scrip has a one-year beta of 0.80, indicating low volatility.

Meanwhile, Indian equity benchmarks touched their fresh lifetime highs today. The 30-share BSE Sensex pack surged more than 350 points to touch its all-time high of 66,435, while the broader NSE Nifty moved nearly 100 points higher to scale a record high of 19,674.

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