)
In what could aid Pune-based Deepak Fertilisers in securing control of Vijay Mallya-promoted Mangalore Chemicals and Fertilizers (MCF), Karnataka State Co-operative Marketing Federation has decided to tender its 2.5 per cent stake in the ongoing open offer to Deepak Fertilisers.
At its annual general meeting on Thursday, the federation decided to exit MCF, according to people privy to the matter. "Yes, Karnataka State Co-operative Marketing Federation has decided to exit MCF as this, according to the majority of board members, is the right opportunity to exit," said a source.
M R Hiremath, managing director of Karnataka State Co-operative Marketing Federation, didn't respond to calls by Business Standard.
At Rs 81.6 a share, the revised joint open offer price of Zuari chief Saroj Poddar and Vijay Mallya turned out to be low, as Deepak Fertilisers surprised the market with a price of Rs 93.6 to acquire additional stake in MCF. Poddar and Mallya jointly own about 39 per cent in MCF. But given the aggressive pricing of Deepak fertilisers, shareholders are likely to tender their shares for the offer at a higher price, say analysts.
Various reports by brokerage houses have said this is the right opportunity for shareholders to exit MCF. Since the open offer was announced, the MCF stock has been hitting fresh high, surpassing the Rs 100 mark on BSE. Through the past few days, however, the stock has lost some ground. On Thursday, it closed at Rs 94.4 on BSE, up 0.16 per cent.
"This (Karnataka State Co-operative Marketing Federation deciding to tender its 2.5 per cent stake in the open offer) is a further boost to Deepak Fertilisers, as this chunk will strengthen its hold over MCF. Besides, the open offer is already priced 48 per cent higher than their earlier open offer price. So, that's a positive sign for shareholders to make an exit at this time," said an analyst tracking MCF.
Through the UB Group, Mallya holds 21.98 per cent stake in MCF. At the end of June, Deepak Fertilisers owned 25.3 per cent stake in MCF, while Poddar owned 16.43 per cent.
