The battle to acquire Mangalore Chemicals and Fertilizers Ltd has heated up with Pune-based Deepak Fertilisers and Petrochemicals Corp Ltd (DFP) raising the offer price to acquire additional 26 per cent equity stake in the firm to Rs 93 per share from its previous offer price of Rs 63 per share, according to a stock market disclosure.
If the open offer is fully successful it would have to shell out Rs 288.41 crore ($47 million).
Currently, Deepak Fertilisers owns 26.1 per cent in Mangalore Chemicals, UB Group owns a 22 per cent equity stake and Saroj Poddar's Adventz group holds 16.43 per cent stake.
Poddar has come as a white knight to UB Group to stave off the hostile bid by Deepak Fertilisers.
Following the 47 per cent upward revision of offer price by Deepak Fertilisers, Adventz and UB Group also hiked their offer from Rs 68.55 a share to Rs 81.6 a share.
This tilts the balance towards the hostile bidder to win the takeover battle. Deepak Fertilisers has offered Rs 11.4 a share more than Adventz-UB Group.
Earlier in May, Deepak Fertilisers hiked the offer price in its unsolicited open offer, increasing its price for an additional 26 per cent equity stake in Mangalore Chemicals to Rs 63 per share from its previous offer of Rs 61.75 per share.
Following this liquor baron Vijay Mallya joined hands with Saroj Poddar’s Adventz and together the two launched a rival joint open offer for Rs 68.55 per share.
As per the pact between UB group and Zuari Industries had signed earlier, Mallya would remain chairman on the board of Mangalore Chemicals if they jointly succeed to acquire controlling stake via an open offer. The pact also allows Mallya to appoint three directors on its board.
However, this was tweaked recently after United Bank of India declared Mallya as a wilful defaulter on account of non-payment of dues.
Both open offers have been approved by the SEBI and the Competition Commission of India.
Following the bidding war, Mangalore Chemicals shares rose about 20 per cent to hit the upper circuit for the day on the BSE at Rs 88.10 each in a weak Mumbai market.
(Edited by Joby Puthuparampil Johnson)