In its bid to take full management control of city-based dry cell battery major Eveready Industries India Ltd., the Burmans of the Dabur family on Monday made an open offer for an additional 26% of shares at ₹320 per scrip.
The mandatory open offer under the takeover regulations of SEBI was made as the Burmans acquired an additional 5.26% stake of Eveready from the open market taking its total shareholding to 25.11%.
The Burmans were already the largest shareholder of the battery maker with a stake of 19.85%. The lead manager for the open offer J M Financial in a notice to the bourses said the acquirer had acquired a 5.26% in Eveready Industries and made an open offer for additional 1.38 lakh shares totaling 26% of the voting right at ₹320 apiece.
Mohit Burman who personally handles the family investment in Eveready said they have been monitoring the situation of the company and felt that it is the appropriate time to step in.
"The company needs direction and the brand has immense potential. We feel we will be able to add value and take this business to the next level," said Mr. Burman, also a director of Dabur, in a statement.
Dabur India Ltd. is not directly involved in the acquisition process of Eveready.
Eveready had been under the control of the BM Khaitan group for two decades. The company came under the Khaitan fold in 1993 when it acquired Union Carbide India (renamed Eveready Industries India).
Its shareholding plunged to just 4.8% from 44.1% over the past two years as the promoter group defaulted on repayments and lenders sold shares of Eveready pledged with them against borrowings.
The promoter group pledged their holdings in Eveready and tea producer McLeod Russel India Ltd. to avail of loans and repay debts of McNally Bharat Engineering.
veready Industries MD Amritanshu Khaitan declined to comment on the development.
A source close to Khaitan family told PTI that it was not aware of the development.
“[The] Burmans have continued to say that their stake in Eveready is entirely investment and not intended to take over the company. They were cornering Eveready shares for more than two years,” the source said.
The Burmans have also written to the Eveready board showing intent for three board berths with non-executive director.
The stock price of Eveready jumped ₹34.35 per share to ₹375 at NSE and hence, the open offer is likely to receive lukewarm response, a city-based stockbroker said.
