VLL had acquired about 37.76 per cent from FDCL's managing director A Prabhakar Reddy. Currently, VLL is owned by non-resident Indians and overseas corporate bodies which have acquired the shares from the original promoters, while 30 per cent of the stake in the company is held by Vidyut Investments Ltd, a wholly-owned subsidiary of Ranbaxy Laboratories Ltd.

Recently, VLL had entered into an in-principle agreement to buy 23,73,524 equity shares of FDCL at a predetermined price of Rs 4 per share from Reddy and associates. Prior to this agreement, VLL did not hold any equity in FDCL.

VLL has appointed SMIFS Capital Markets Ltd as manager to the open offer, which will open on May 14, 1999, and close on June 12, 1999. It has fixed March 26 as the cut-off date to be eligible to participate in this offer. However,for investors holding blank transfer deeds and whose shares are pending with the company for transfer also become eligible for the offer, the notification said.

The open offer is to buy 20 per cent of the paid-up equity capital of FDCL amounting to 12,57,200 shares at a price of Rs 4 per share which is equal to the negotiated price. The ailing FDCL has a paid-up equity capital of Rs 6.28 crore and is engaged in manufacturing bulk drugs. The shares of the company are listed on HSE and BSE.

Interestingly, VLL has not opened any escrow account with any bank. However, it has ensured to pay the consideration out of its internal accruals and claimed that it has sufficient resources to pay-off.

FDCL had reported a net sale of Rs 5.32 crore and a net loss of Rs 2.14 crore as on March 31, 1999. During the nine-month period in the current year, FDCL has registered sales of Rs 4.82 crore and incurred a net loss of Rs 2.71 crore.