Shares of Tribhovandas Bhimji Zaveri (TBZ) rallied 20% to hit their upper circuit at Rs 366.50 on Tuesday, up from a previous close of Rs 305.45, after GRT Jewellers India signed a share purchase agreement (SPA) to acquire a controlling stake in the company.

Under the SPA, GRT Jewellers will purchase 4,94,59,775 shares, constituting 74.12% of TBZ's voting share capital, from the promoter group at a maximum price of Rs 209 per share, for a maximum aggregate consideration of Rs 1,033.71 crore.

The change in control triggers a mandatory open offer under SEBI takeover rules. GRT is required to buy up to 1,72,70,845 shares, or 25.88% of the voting share capital, from public shareholders at Rs 249.61 per share, aggregating to a maximum of Rs 431.09 crore in cash. The open offer price is an 18% discount to Monday's closing price.

TBZ, founded in 1864 and based in Mumbai, currently operates 37 stores. GRT Jewellers, founded by Chairman G. Rajendran in 1964 and headquartered in Chennai, runs 68 stores across India and one in Singapore, with over 12,000 employees.

"We are truly excited to acquire the 162 years old Legacy Brand TBZ," said G.R. Ananth Ananthapadmanabhan, Managing Director of GRT Jewellers, adding that the deal fits the company's strategy of expanding its presence across India.

The transaction is subject to regulatory approvals, including from the Competition Commission of India, and customary closing conditions. Deloitte was the lead transaction advisor, with Axis Capital acting as financial advisor and Trilegal as legal counsel to GRT.