Days after announcing acquisition of nearly 38 per cent stake in SpiceJet for about Rs 740 crore, media magnate Kalanithi Maran launched an open offer to acquire an additional 20 per cent in the no-frills carrier for Rs 57.76 a share.
The open offer would involve an outgo of around Rs 480 crore, taking the overall deal size to 1,220 crore. Late last week, Maran offered to pick up 37.73 per cent in SpiceJet at Rs 47.25, aggregating to Rs 739.57 crore, according to a statement from the airline.
Commenting on the transaction between him and Maran, major promoter and US investor Wilbur Ross said he received a “very fair price” for offloading his entire 30 per cent stake in the airline to the Chennai-based industrialist and his company KAL Airways.
“We find the price to be very satisfactory to us. We think it is a very fair price,” Ross said in Mumbai.
Aiming to acquire controlling stake in the no-frills airline, KAL Airways made an open offer to acquire an additional 20 per cent stake in the carrier for an estimated Rs 479.29 crore or Rs 57.76 a share, which is a 3 per cent premium over the closing price on Friday of Rs 56.05.
The move came two days after Maran, CMD of the Chennai-based media powerhouse Sun Network, agreed to acquire 37.73 per cent stake in the company on his individual capacity and through his aviation company KAL Airways.
“The acquirers hereby make this offer to the shareholders of the target (SpiceJet) to acquire up to 8,29,80,161 equity shares of face value of Rs 10 each, representing in aggregate 20 per cent of the target company at a price of Rs 57.76 per fully paid-up equity share,” the company’s offer manager Enam Securities said in a public statement. The offer would be launched on August 6 and close on August 25, it said.
Speaking to a private television channel in Mumbai today, Ross said the price was negotiated “for quite a long time. And we think it is a very fair price.”
He said his foreign currency convertible bonds (FCCBs) were to mature in October. “Under the regulations, we could not have converted them over. So the best option was to find a strategic buyer and negotiate the transaction with him.”
The stake purchase from WL Ross involved acquisition of around 10 per equity which was already converted. The rest of it was in the form of FCCBs which, when converted, would amount to another 20 per cent stake.
Another SpiceJet stakeholder and director Ajay Singh said, “we think the deal is good for the company because it adds a great deal to it. Maran has a group which is quite strong financially. It would also bring in a lot of value to SpiceJet. I think there is a bright future both for the industry and SpiceJet in particular.”
To a question whether he too has plans to exit, Singh said “at this time, I have no plans to exit at all“.
Expecting a good premium offer in the open offer, the SpiceJet counter rallied as much as 6 per cent to Rs 59.55 in morning trade but closed at Rs 55.30 a share, down 1.34 per cent over the previous close on the Bombay Stock Exchange, spooked by the low premium in the open offer.