FIs keen on open offer for ACC shares

FIs keen on open offer for ACC shares
DEV CHATTERJEE

MUMBAI, APR 28: Financial institutions would be willing to offload its entire stake in cement major ACC if Gujarat Ambuja Cements (GACL) makes an open offer for the company. FIs which currently hold over 33 per cent stake are the largest shareholders in the cement company which is in the process of being acquired by GACL of the Sekhsarias.

``The price offered to the Tatas is very attractive. We are now waiting for the Sebi's decision whether Ambuja should make an open offer or not,'' IDBI chairman GP Gupta said. ``Every shareholder should get a chance to sell the shares at the same price,'' he added. While GACL paid Rs 373 for the ACC share, the market price of ACC is very low at Rs 139.

``As far as we know, Sebi has not taken a decision on whether Gujarat Ambuja should make an open offer or not. We are in talks with all the parties,'' Gupta said, adding, ``We would prefer to wait for the Sebi verdict.''

Gupta's statement that Sebi has still not taken any official decision on ACC case is significant considering that Gujarat Ambuja Cement and the Tatas were transferring management through the back-door without giving the small shareholders of ACC any chance to sell at the same high price at which the Tatas sold their stake.

Gujarat Ambuja Cement had recently acquired 7.2 per cent from the Tatas and another 4 per cent from them at a price of Rs 373 per share. Though the company's acquisition has not triggered Sebi's takeover code threshold of 15 per cent and also not resulted in any change in management, Sebi has re-opened the case after the departure of ACC chairman Pallonji Mistry and vice chairman Dr S Ganguli two days back.

Gujarat Ambuja MD Narottam Sekhsaria is already on the board of ACC as the vice-chairman and one more Sekhsaria appointee is on the board of ACC. The board reshuffle at ACC took place days after Gujarat Ambuja Cements has become the largest non-institutional shareholder in ACC by buying out another four per cent from the Tatas. While GACL's shareholding in ACC has increased to over 11 per cent, the erstwhile promoters - the Tata group - now holds just over around 3.2 per cent in the cement company.

Sekhsaria, who was inducted as deputy chairman of ACC after GACL picked up a 7.2 per cent stake in the company from the Tata group for a whopping Rs 455 crore, has thus been effectively elevated in the hierarchy.

FIs sources later told this newspaper that they have lot of options including selling its stake to some third party through a negotiated deal. ``If we get the right price, we can still sell ACC shares to some third party who can make an open offer,'' sources said.

This effectively means that the FIs want Gujarat Ambuja Cements to either buy their stake in ACC at the same price (Rs 373 per share) or face the prospects of a takeover battle over the company with a third party. Gujarat Ambuja Cements, say FI sources, has already overstretched itself in buying the Tata stake and cannot afford a takeover battle.