The Securities and Exchange Board of India (Sebi) is considering incorporating the decision on the Gujarat Ambuja-ACC case in its takeover code.
The decision not to ask Gujarat Ambuja Cements Ltd (GACL) to make an open offer for the minority shares has become a landmark one, since the regulator has made it clear that the acquisition of the stake did not mean a change in control unless the buyer had the majority on the board of directors.
Sebi chairman D R Mehta said, "We are looking into the decision and whether we should incorporate it as part of the code."
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Mehta made it clear that the regulator clearly thought there was no change in control despite some recent board changes in ACC, where Shapoorji Pallonji Mistry stepped down as chairman and Tarun Das, secretary general of the Confederation of Indian Industry (CII), took his place.
"We do not see it as a change in control. Das is an outside director and there has been no change in control as far as the board is concerned," the Sebi chairman said.
GACL has all along maintained the investment in ACC is for strategic reasons and not to interfere in the day-to-day management of the company. The 7.2 per cent acquisition by GACL in ACC also has another clause of the Tatas selling the remaining 7 per cent as well to GACL.
With several cement majors eyeing ACC at a time when the cement sector is going through a major consolidation phase, the unfolding drama at ACC has attracted a lot of attention.
Recently, GACL acquired another 4 per cent, taking its total stake now to 11.2 per cent.
The Unit Trust of India (UTI) had also said it is in agreement with the Sebi move not to ask Gujarat Ambuja Cements Ltd (GACL) to make an open offer to the shareholders of ACC Ltd.
UTI chairman P S Subramanyam had told Business Standard: "We have no problem with this. Since the issue is whether the board control has changed or not, the Sebi decision is all right by us."
UTI, together with other institutions including Industrial Development Bank of India (IDBI), hold over 22 per cent in ACC.