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Vijay Mallya may not sell Mangalore Chemicals shares

Deepak Fertilizers chief Sailesh Mehta likely to tender shares in favour of Zuari

It is not UB Group chairman Vijay Mallya, but Deepak Fertilizers chief Sailesh Mehta who may tender his shares in Mangalore Chemicals and Fertilisers (MCF) in favour of Zuari group during the fresh open offer launched by Saroj Poddar for acquiring additional equity of the Karnataka-based fertilisers manufacturing company, industry sources said.

Significantly, Deepak Fertilizers did not launch any counter offer against Zuari’s bid to be in the race to gain control over MCF. Friday was the last date for public announcement of a competing offer as per the first detailed public statement.

“Poddar is still in partnership with Mallya. So the question of Mallya selling his stake to Zuari does not arise,” industry sources told FE.

“Rather, Deepak Fertilizers may take this opportunity (fresh open offer) to tender its shares in MCF in favour of Zuari,” the sources added.

There were market speculations that the liquor baron, presently going through troubled times, would sell his holdings in Mangalore Chemicals to Paddar as the latter, a few days ago, had made an upward revision in his fresh open offer size to buy up to 36.56% additional stake in MCF.

Interestingly, as the Mangalore Chemicals has only 30% public shareholding, Poddar’s bid to acquire additional 36.56% stake in the company will now require Deepak Fertilizers’ to sell out a portion of its stake to him.

Deepak Fertilizer’s CFO Somnath Patil was unavailable for comment on whether his company would sell its shares in MCF. Based on the revised offer size, the maximum consideration payable under this offer at the offer price of Rs 91.92 per equity share would be Rs 398.28 crore.

The Mallya-Poddar combine and Deepak Fertilizers had both launched competing open offers for MCF that concluded in November last year. Upon conclusion of their respective open offers, Mallya and Poddar ended up with a 38% stake in the company, while Deepak Fertilisers held 32%.

Interestingly, the current open offer launched by the Zuari group didn’t mention any of the UB Group companies or promoters as persons acting in concert, unlike the last open offer it had launched.

In a surprise move, Mallya had resigned as MCF director on December 1. The Bangalore-based company, considered one of the last crown jewels of the liquor baron, did not cite any reason for his resignation.

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First published on: 03-01-2015 at 03:57 IST
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