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Spinnaker Global and Eight Capital have jointly announced an open offer to shareholders of steel firm Pennar Industries to buy 20% in the company for around Rs 72 crore plus interest for delay in making the open offer that was originally scheduled for January 2008.

The two investment firms have revised the offer price to Rs 28.75 (plus Rs 2 as interest cost), over two times compared to the price they offered in the previous open offer over two years ago.

Spinnaker and Eight Capital had originally invested Rs 122 crore together through two sets of convertible debentures. While one set of debentures converted at Rs 9.75 per share, the other was optionally convertible at Rs 45 a piece.

It is believed the investors converted the first set of debentures (worth around Rs 50 crore) in late 2007-08 that gave them around 27% stake in Pennar. The fate of the remaining debentures could not be ascertained but it is likely that it would not have been converted as the conversion price was set at Rs 45.

Pennar scrip is trading at Rs 38.65 which is much higher than the offer price even after including the interest cost to be paid by the acquirers. This will mean the offer will not find many takers.

Spinnaker had sold a large chunk of shares to JR Realtors (promoted by My Home Group that sold half of its stake in cement business to Irish building materials group CRH two years ago) at Rs 32.2 a share. Apparently it exited its investment during June-September quarter last year when the stock was trading at around Rs 25 and doesn't figure among the significant shareholders of Pennar as of March 31, 2010. Eight Capital owns around 9% in the firm.

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