Scooters major Bajaj Auto has not agreed to withdraw its US-64 units, worth Rs 172 crore, after submitting them for repurchase by the Unit Trust of India.
Senior UTI officials insist that after a series of meetings between UTI and the company, Bajaj Auto decided to withdraw units it had given for redemption. However, Business Standard has learnt that Bajaj Auto has not withdrawn its redemption application.
Sources close to the company insist that not only has Bajaj Auto not withdrawn its redemption request, it has also been promised by UTI that the redemption money will be paid after 15 days at the current repurchase price of Rs 14.55.
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This is as per a confirmation receipt sent by UTI to Bajaj Auto after the Trust accepted the redemption application.
Rahul Bajaj could not be contacted as he was out of the country. However, sources close to the company said the scooters major has decided not to withdraw the application despite pressure from institutions and the government .
"Bajaj Auto did not want to be answerable to its shareholders by withdrawing the redemption request," said the sources.
In conversations with UTI chairman P S Subramanyam, the Bajaj Auto chairman enquired whether UTI planned to change the pricing of the scheme to its NAV from the current repurchase price of Rs 14.55.
Although the UTI chairman told Rahul Bajaj that there was no such plan (to switch to a NAV-based price), it is understood that Bajaj Auto has decided to go ahead with the redemption request.
According to sources, Bajaj Auto has also asked UTI to confirm in writing that the company will get redemption at the current prices even if the redemption request is met after a fortnight. Sources say that the company has asked UTI to confirm that any downward revision in the price over the next two weeks will not have any adverse impact on the Bajaj Auto request.