Reliance Power to merge with RNRL

The boards of Reliance Power and RNRL will meet on July 4 to consider a merger.

Anil Ambani-led Reliance Power’s board will on July 4 consider merging another group firm Reliance Natural Resources with itself.

A meeting of Reliance Power’s board of directors has been called on Sunday to consider the merger,the company said in a statement.

The statement was released after the close of stock market,but speculation about the deal pulled down the shares of both the companies sharply in the last minutes of trading.

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While RNRL settled 2 per cent down at Rs 63.65 a share,R-Power managed to close 3 per cent up at Rs 174.50 a piece.

In intra-day trade,R-Power had gained as much as 5 per cent,but RNRL fell by over 7 per cent.

While the companies did not disclose any details of the proposed merger,some brokers said that rumours are about a share-swap deal with four shares of RNRL for every one R-Power share. Currently,the two stocks have market values in the ratio of about 1:3.

The two companies together command a market capitalisation of Rs 50,000 crore.

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RNRL said in a separate statement that its Board will meet on July 4 to consider the merger.

Late last month,RNRL signed a revised gas sales master agreement with Mukesh Ambani-led RIL for sourcing gas for Reliance Power. But,the agreement did not contain the price,quantity or duration of supply of gas.

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