While ICI Plc had maintained that their purchase was cleared by the rules governing foreign investments, Asian Paints had disputed this and had said that it would not transfer the shares to ICI Plc. At that time, these could not be transferred to ICI India either, as its net worth wasn't high enough under the law, a company cannot invest more than 30 per cent of its net worth in another company.

Now, with half the shares sold off, ICI India can clearly ask for transfer of the remaining shares to itsname. When contacted, the ICI spokesperson refused to comment on what the company's strategy would be with regard to the remaining shares. With the 4.5 per cent stake that UTI has bought today, it becomes the largest institutional shareholder in the company with about 12.5 per cent stake.

Kotak Mahindra had acquired these shares from Atul Choksey, former promoter and managing director of the company.

Due to difference of opinion with the three promoters, Choksey had sold off his stake to Kotak which in turn, planned to sell the shares to the multinational, ICI Plc. Kotak Mahindra will use the proceeds to repay a loan advanced by ICI Plc to pick up the Asian Paints stake.

Ashwin Dani, vice chairman of Asian Paints and one of the three existing co-promoters, said: "We welcome Unit Trust of India as a shareholder of the company." With the 4.5 per cent stake that UTI has bought today, it becomes the largest institutional shareholder in the company with about 12.5 per cent stake.