Personally I don’t like it… I purchased shares of company focused on agro chemicals and now I will be forced to become (unless I sold my shares) shareholder of company having multiple business lines (conglomerate). This takes away most of upside in the share price.I like demergers where bigger company splits into smaller units which unlocks value as it brings sharp focus and accontability… This is opposite of that.
In all Godrej Agrovet’s businesses, I think Astec will continue to do very well in future but being part of bigger company, it may not contribute to the shareholder returns as other businesses may dilute the margins. Having said that, I am sure some shareholders will like it as it will derisk the company due to presence in multiple sectors(animal feed, dairy, Palm Oil, pesticide,herbicides etc). But now investment in this company will be like investing in Mutual Fund
Another view could be Astec will become part of larger i.e better market cap company with Godrej name. So it may increase liquidity in the counter…
Will need to wait to see merger ratio but market reaction says it all… I will be waiting to see what happens next
Disclosure - forms 10% of my portfolio