 "Poddar raises stake to 16% in MCF; bidding war looms")
Vijay Mallya's UB Group's stake is down to 21 per cent, after its lenders sold pledged MCF shares in the market last week to recover loans granted to his other group companies.
With corporate raider Deepak Fertilisers and Petrochemicals cornering a 24.5 per cent stake from an assortment of shareholders, lawyers say it can seek board seats. Deepak also plans an open offer for MCF in the next few days.
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Poddar was to buy MCF from Mallya under a friendly takeover in April this year. However, UB walked away. Poddar is expected to meet Mallya in the next few weeks to re-start negotiations.
Corporate lawyers say in a public company, two-thirds of the directors are appointed by the shareholders and the remaining third in accordance with the manner prescribed in the Articles of Association. Failing which, they, too, must be appointed by the shareholders. Once appointed on the board, these directors will have to get elected by the shareholders after a recommendation from the board.
As of now, apart from Mallya, who is chairman of MCF, other members of the board are his confidante, S R Gupte, the managing director of MCF, Deepak Anand, the director (works) Prabhakar Rao and two independent directors.
Open offer
Corporate lawyers say it will be difficult for the UB group nominees to get elected by the shareholders if they do not hold enough shares. Poddar's 16 per cent stake will come in handy for UB to keep the raider away, lawyers say.
They add, though, that if Deepak Fertilisers launches an open offer in line with the takeover code, it will have an advantage.
Emails sent to both Deepak Fertilisers and UB to seek their comments did not elicit any response.
With a bidding war imminent, MCF's shares shot up 10 per cent on Thursday, to close at Rs 67.85 a share.
WHO DARES, WINS
|United Breweries' stake is down to 21% after its lenders sold pledged shares of Mangalore Chemicals and Fertilizers (MCF) last week to recover loans given to Vijay Mallya's group companies
|Deepak Fertilisers and Petrochemicals has cornered a 24.5% stake in MCF
|Kolkata-based Zuari Fertilisers has bought another 2.5% stake in MCF from Reliance Capital
|In a public company, two-thirds of directors are appointed by shareholders
|Lawyers say if Deepak Fertilisers launches an open offer according to Sebi's takeover code, it will have an advantage in seeking control over the company