Goldman, Merrill jointly pick up 5.5% in Eveready

HSBC Global recently bought 10% in the BM Khaitan firm.

Goldman Sachs and Merrill Lynch have jointly picked up 5.5 per cent stake in Eveready Industries. The move follows the acquisition of nearly 10 per cent stake by HSBC Global Investments in the company.

Goldman Sachs has acquired nearly 3 per cent stake, while Merrill Lynch has bought nearly 2.5 per cent stake. The mode of acquisition was through global depository receipts (GDRs) offered by the B M Khaitan group-controlled Eveready Industries. HSBC Global had acquired 9.76 per cent stake in the company.

Investment banking sources said the GDR, which was aimed at raising $30 million, ended up mobilising $33 million (nearly Rs 153 crore) owing to enhanced interest from foreign institutional investors, particularly from south-east Asia and Europe. The GDR issue was priced at Rs 95 a share, a 12-13 per cent discount from the ruling market price on the BSE.

They added the investors were attracted by the good distribution of the company engaged in the business of batteries and tea. The company is world's third largest producer of carbon zinc batteries. It will use this fund for completing BPL's battery unit acquisition and for reducing its debt. In October 2005, the company acquired the ailing BPL Soft Energy System for Rs 45 crore.

The shareholding of the Khaitan family, the promoters, will go down on the expanded capital following the GDR. The promoters hold a 43 per cent stake.