Most minority shareholders of Cadbury India are not in favour of the chocolate maker’s new buyback offer of Rs 1,900 per share and have objected to the low valuation.
The Investors' Grievances Forum (IGF), which is fighting a case on behalf of minority shareholders, has filed an affidavit in the Bombay High Court declining the new offer from Cadbury India.
In its affidavit, IGF has said that it has received letters from more than 40 minority shareholders stating that they do not agree to the price of Rs 1,900 per share. “None of them are willing to sell (their shares) at less than Rs 3,000 per share,” the affidavit filed by IGF informed the HC.
The case was heard in the Bombay HC on Friday.
Early this month, Cadbury India had offered Rs 1,900 per share, a nine per cent premium to the price recommended by independent evaluator Ernst & Young (E&Y), to minority shareholders for its buyback programme to settle the legal dispute. E&Y, the HC-appointed independent valuer, had recommended Rs 1,743 per share for the buyback offer.
UK-based Cadbury Plc, Cadbury India's former parent, which was bought by Kraft Foods last year for $19.6 billion, wanted to buy back the remaining 2.42 per cent stake from minority shareholders of its Indian unit. However, the latter were not happy with the company's offer of Rs 1,340 per share and had approached the HC, which had appointed E&Y to revalue Cadbury India's shares.