| The price quoted by Financial & Management Services Ltd is 40 per cent higher than today's closing rate of the stock. |
| Company managing director Kaushal Kumbhat said the firm has also said it would come out with a 20 per cent open offer, post acquisition of the state government's stake. |
| L N Bangur group, the current promoters with a 48 per cent shareholding, do not need to launch a mandatory open offer in case it acquires the government's stake as the buy out becomes inter se transfer among promoters. |
| Kumbhat said he, along with three like minded people, were keen on carrying out a due diligence exercise prior to launching the offer. |
| He was ready to submit one-fourth of the fund required for acquisition of the government's stake in a bank account to prove his seriousness. |
| D K Panwar, chairman of implementation secretariat of Andhra Pradesh, confirmed the receipt of a letter from Financial & Management Services Ltd. |
| He said the government would offer the first chance of purchasing its shareholding to the Bangurs. Drawing a parallel with Godavari Fertilisers, he said the government would go for open bidding, if the Bangurs failed to match its expectation. |
| Panwar said the decision to offer the first right of refusal to the Bangurs was in line with the "good corporate practice." |
| He said:" A joint venture agreement between the Bangurs and the government, ensures that one party will enjoy the first right of refusal in case the other pulls out. But the agreement is not endorsed with the Articles of Association. The legal opinion taken by the government also suggests that the previous joint venture agreement is not binding." |
| He indicated that a Hyderabad-based consultancy firm, which was appointed by the government, valued Andhra Pradesh Paper Mills at over Rs 300 crore. |
Explore Business Standard