Parvinder Singh, the promoter of Ranbaxy Laboratories, has sold Rs 15 lakh worth of shares of the company "" equal to three per cent of his stake. Worth a sizeable Rs 65 crore, the shares were placed with Indian investment institutions and banks by JM Financial Consultancy Services. Though the shares sold at a discount of 5.5 per cent on the National Stock Exchange, analysts consider the share price of Rs 650 decent considering the depressed conditions in the market. Singhs stake is expected to decline to 32 per cent; at present, mutual funds hold 14 per cent, the public holds 24 per cent, and banks and institutional investors hold the rest.
The promoter of Ranbaxy is reducing his stake to pay off costly debts incurred since 1993; these include funds borrowed to acquire shares at Rs 400 through warrant rights in a GDR issue. Singh intends to sell a total of about 35 lakh shares in the market. Last year, Ranbaxy had asked Merrill Lynch to sell a seven per cent stake of the promoters to foreign investors. However, the offer fell through due to an unsatisfactory share price.