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Tree House Shares Fall 5% on Announcement of Merger with Zee Learn

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Mumbai: Shares of Tree House Education & Accessories slumped 5 per cent to Rs 195.90 after the pre-school chain announced merger with Zee Learn.

Tree House's shareholders will receive 53 shares of Zee Learn for every 10 held in Tree House.

Tree House has a net worth of Rs 644 crore and turnover of Rs 207 crore as of March 31, 2015, while Zee Learn has a net worth of Rs 234 crore and turnover of Rs 121 crore.

Traders said that the market had expected a more favourable swap ratio for Tree House shareholders.

In Tree House, the promoters currently hold 20.54 per cent stake, while 79.46 per cent is held by the public.

Both Zee Learn and Tree House are business activities and with a view business operations, the board of directors of the company have decided to amalgamate Tree House with Zee Learn, Tree House said in statement.

Rajesh Bhatia, MD of Tree House, told that the combined entity will have 2000-plus pre-schools and 100-plus K-12 schools with over 1.5 lakh students.

At 11:16 a.m., shares of Tree House were locked in 5 per cent lower circuit while Zee Learn shares were down 1.3 per cent at Rs 40.60 as compared to a flat broader market.

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