Apollo Micro Systems Shares Rally 5% After Announcing Premier Explosives Deal
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Apollo Micro Systems shares gained 5% after the company announced a deal to acquire the promoters' stake in Premier Explosives. The acquisition is expected to expand Apollo's presence in India's defence and aerospace sector.
Buying interest returned to Apollo Micro Systems on Friday after the company disclosed plans to buy the promoters' stake in Premier Explosives. The stock climbed 5% during the session as investors reacted to the proposed acquisition, which is valued at nearly ₹1,550 crore.
The agreement covers the purchase of the promoters' 41.33% shareholding and will be executed entirely through cash.
On Friday, Apollo Micro Systems' shares closed at ₹408.55 apiece on the National Stock Exchange (NSE).
Transaction To Close After Approvals
The agreement has already been signed between the two sides, but the transfer of shares will take some time to complete.
Apollo Micro Systems said the acquisition is expected to be completed during the quarter ending December 2026, subject to the fulfilment of customary conditions. Apart from shareholder consent, the proposal will also need approvals from regulators, including the Competition Commission of India (CCI).
Following completion of the deal, Premier Explosives will continue operating under its existing name while becoming a part of the Apollo Micro Systems group.
Open Offer To Public Shareholders
The acquisition will also trigger an open offer under SEBI's takeover regulations.
Apollo Micro Systems has announced that it will make an offer to acquire up to 26% of Premier Explosives' fully diluted voting equity share capital from eligible public shareholders. The offer will be carried out in accordance with the provisions laid down under the takeover code.
Strategic Push Into Defence And Aerospace
Premier Explosives is engaged in the manufacture of high-energy materials, including rocket motors used in defence and aerospace programmes. The company also produces countermeasures, explosives and munitions for strategic applications.
With this acquisition, Apollo Micro Systems is looking to expand its presence across India's defence manufacturing ecosystem by combining electronic defence systems with energetic materials and propulsion capabilities.
The company believes the combination will help it participate in a wider range of defence and aerospace projects while strengthening its manufacturing capabilities.
Management Sees Long-Term Growth Opportunity
Commenting on the acquisition, Baddam Karunakar Reddy, Managing Director of Apollo Micro Systems, said the transaction would strengthen India's indigenous defence manufacturing capabilities and enhance the country's expertise in energetic materials and space programmes.
A. N. Gupta, Founder and Chairman of Premier Explosives, said joining hands with Apollo Micro Systems would create fresh opportunities for innovation, technology development and long-term growth while building a stronger domestic defence and aerospace ecosystem.
Speaking on behalf of the AKS Family Trust, promoter trustee Shonika Prasad said the transaction marks an important milestone for Premier Explosives and reflects confidence in Apollo Micro Systems' ability to lead the company's next phase of growth.
This article is for informational purposes only and should not be considered investment advice from Kotak Neo. For compliance T&C and disclaimers, Visit www.kotakneo.com/disclaimer
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