Amtek Auto jumps 11% as Mahindra CIE in race for co's German biz -:- Equity Research

Amtek Auto shares rose more than 11 percent intraday Tuesday after sources told CNBC-TV18 that Mahindra CIE may also be interested in company's German business. Amtek Auto has also been talking to other players in the market to sell some of its stake in overseas companies, non-core assets and real estate as it is desperately looking for a buyer to pare its Rs 15,000-crore debt, according to people privy to the two companies. The management of Amtek Auto said sale of its European assets has been delayed by a month. The company expects to close the sale of German subsidiary Neumayer Tekfor by end of October. The debt-ridden auto ancillary company has been in trouble since August 2015, especially after it started posting losses in Q1FY16. Amtek has been posting losses for every quarter since then while on other side, interest cost has also been rising due to high debt. In the quarter ended June 2016, it had posted a loss of Rs 320 crore against loss of Rs 529 crore in preceding quarter while interest cost jumped to Rs 328 crore from Rs 290 crore in same period. In order to cut down huge debts, loss making Amtek Auto in last year had appointed Morgan Stanley as advisors to assist in the group’s debt reduction plan.