Holcim's ACC offer falls 15% short of target

LIC sells 5% stake, while FIs, FIIs & the public together offered 16% stake.

Holcim's open offer for Associated Cement Companies (ACC) closed today, with a subscription of nearly 21 per cent. This takes Holcim's stake in ACC to nearly 35 per cent, which is 15 per cent short of its target 50.1 per cent.

Industry sources said the Life Insurance Corporation "" the single largest shareholder in ACC "" was believed to have tendered shares representing nearly 5 per cent stake.

Priced at Rs 370 a share, the offer drew applications amounting to nearly 16 per cent from shareholders, including financial institutions, foreign institutional investors and the public.

However, no official confirmation was received from the lead managers to the issue till the time of going to press.

"We are still collecting figures. A large number of applications were made in physical form, making the collection of data a lengthy process," executives added.

After the offer, LIC's stake in the company will fall to nearly 11 per cent. The ACC stock today closed at Rs 357.25 on the Bombay Stock Exchange (BSE), 1.2 per cent lower than the last closing price. Industry sources said Holcim might go in for creeping acquisition to scale up its holding to 50 per cent in next six months. Anil Singhvi, executive director of Gujarat Ambuja Cements, was not available for comments.

Holcim had announced a tie-up with Gujarat Ambuja Cement to create the world's largest cement company, investing $800 million in India. The Swiss cement maker had agreed to acquire a two-third stake in Ambuja Cement India, an investment company that holds a 13.8 per cent stake in ACC.

According to the shareholding pattern of the company on December 31, 2004, mutual funds held a 5.21 per cent stake in ACC, banks, financial institutions and insurance companies collectively held 13.99 per cent and the Indian public held 11.83 per cent.