Mallya, Poddar join hands to thwart MCFL takeover
May 13 2014 , New Delhi
The Pune-based company, headed by Shailesh Mehta, had made an open offer to buy a 26 per cent stake in the Vijay Mallya-promoted firm at Rs 63 per share. But the Zuari-UB combine on Tuesday offered a better deal at Rs 68.55 per share. This will put the deal value at Rs 211.22 crore.
Sources privy to the development said Deepak Fertilisers was weighing the option of further sweetening its offer. If at all the Shailesh Mehta firm finally decide to haggle it out with Poddar and Mallya, it may offer up to Rs 70 for every MCFL share. On Tuesday, the stock closed at Rs 70.55 in Mumbai trading.
Deepak Fertilisers owns approximately 25 per cent stake in the company, while Zuari and another Saroj Poddar-owned company Adventz group together own 16.43 per cent and Mallya’s UB Group holds 22 per cent.
Late on Monday night, Poddar and Mallya forged the alliance making the three-way corporate war all the more interesting. MCFL is considered a prized asset being the only company with fertiliser facilities on the west coast.
In a filing to the stock exchanges, Ambit Corporate Finance and ICICI Securities made the offer on behalf of Zuari Fertilisers, Zuari Agro Chemicals, United Breweries, Kingfisher Finvest and McDowell, representing both Poddar and Mallya.
The filings said, Poddar and Mallya propose to acquire 3.08 crore shares at Rs 68.55 apiece. This chunk constitutes 26 per cent stake in MCFL. Shailesh Mehta of Deepak Fertilisers was unavailable for comment.
The MCFL board of directors is scheduled to meet in Bangalore on Thursday under chairman Vijay Mallya to formally endorse the counter-offer.
Mallya is likely to make public his intention to run MCFL jointly with Poddar once the 26 per cent counter-offer concludes successfully. Once that happens, Mallya may invite two Poddar nominees to join the MCFL board.
Deepak Fertilisers made a hostile bid for MCFL on April 23 through a public announcement to acquire 3.08 crore shares at Rs 61.75 apiece and then went on to revise the offer to Rs 63 a share, the highest price at which it acquired shares from the open market to raise its stake to a little over 25 per cent through an announcement on May 1.
JM Financial Institutional Securities made the revised the offer on behalf of its client SCM Soilfert and Deepak Fertilisers to acquire up to 30,813,939 fully paidup equity shares of MCF constituting 26 per cent of share capital at an offer price of Rs 63.