The bid to acquire Mangalore Chemicals and Fertilizers Ltd (MCFL) has intensified with rival parties Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPCL) and Zuari Fertilizers and Chemicals, which is backed by the UB group, revising their open offer price to outbid one another.
DFPCL has aggressively revised its open offer price by 48 per cent to Rs.93.60 per share from its earlier offer price of Rs.63 to acquire up to 3.08 crore equity shares, representing 26 per cent stake in MCFL. SCM Soilfert and DFPCL are making a hostile takeover bid to acquire the company, controlled by the UB group and its Chairman Vijay Mallya, for an estimated Rs.288.41 crore.
On the other hand, Zuari Fertilisers and Chemicals Ltd. has revised its open offer price to Rs.81.60 from the earlier open price of Rs.68.55 per MCFL shares to acquire 26 per cent stake in the company. Zuari Fertilizers and Zuari Agro Chemicals are making a counter bid to acquire 26 per cent stake in MCFL for Rs.251 crore. United Breweries (Holdings), Kingfisher Finvest India and McDowell Holdings are persons acting in concert with Zuari to prevent DFPCL to acquire the company.
At present, DFPCL holds little over 25 per cent stake in the company after purchasing shares from the open market.
In a similar manner, Zuari Agro Chemicals has acquired 16 per cent stake in MCFL. The UB group has 22 per cent stake.
Following the bidding war, MCFL shares, on Friday, surged 20 per cent and hit the upper circuit to close at Rs.88.10, up 19.95 per cent. Thursday was the last day for both rivals to announce their revised open offer price. Now, the open offers will start on October 1.
The DFPCL’s offer price is better than Zuari’s and now the public shareholders will decide whom to sell.
On Friday, DFPCL shares closed with a gain of 0.22 per cent at Rs.159.25 and Zuari Agro shares closed with a loss of 2.81 per cent at Rs.195.40 on the BSE.
On raising the open offer price for MCFL, Deepak Fertilisers CFO Somnath Patil said, “Our average purchase price of MCFL shares works out to Rs.78 per share. We feel this is a fair representation of the value of MCFL, considering its synergies with our business. We see value creation opportunities over medium to long term”.
