Shares of Kirloskar Industries Ltd. and Swaraj Engines Ltd. gained over 10% after Mahindra & Mahindra Ltd. purchased Kirloskar's stake in the diesel engine manufacturer.
Mahindra & Mahindra will acquire a 17.41% stake in Swaraj Engines from Kirloskar Industries for Rs 296 crore, it said in an exchange filing. Upon completion of the transaction, Mahindra & Mahindra's stake in Swaraj Engines will increase from 34.72% to 52.13%.
Since Mahindra will have a majority stake in the company, Swaraj -- currently an associate of the company -- would become a subsidiary.
Reacting to the deal, shares of Kirloskar Industries gained as much as 10.5% to a 52-week high of Rs 1,815, while Swaraj Engines soared as much as 14.7% to a 52-week high of Rs 1,945.
Shares of Mahindra & Mahindra rose 1.5%.
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