Crompton Greaves' shares tank 8% as Avantha decides to exit business

Crompton Greaves' shares fell sharply by nearly 8% as Avantha Group will sell its entire holding of 34.37% in demerged consumer products business of the company to private equity investors Advent International and Temasek for Rs 2,000 crore.

Reacting to the move, shares of Crompton Greaves declined 7.77% to Rs 155.40 at the BSE.

On the NSE, the scrip was down 7.71% to Rs 155.55.

The two private equity firms will then make an open offer for additional shares to gain ownership of the consumer unit of Avantha Group -- Crompton Greaves Consumer Electricals (CGCEL) -- which will be listed on the National Stock Exchange and the BSE.

The deal values CGCEL at an enterprise value of Rs 6,600 crore.

In February this year, Crompton Greaves' Board had approved full demerger of its consumer products business, saying that shareholding of CGCEL, upon completion of the demerger, will mirror the shareholding of Crompton Greaves.