Two Nusli Wadia group companies -- Bombay Dyeing and Britannia Industries -- have appointed JM Morgan Stanley and Infrastructure Leasing & Financial Services (IL&FS), respectively, as merchant bankers for their proposed share buyback programme.
Confirming the development, senior officials of the Wadia group said: "The buyback of shares by both the companies is likely to commence by first week of September."
Bombay Dyeing, which had come under a possible takeover threat from the Kolkata-based jute baron Arun Bajoria, will vie for around 25 per cent (up to 1.02 crore equity shares) of the total existing share capital of the company at a maximum price of Rs 60 per share.
This will take the promoter's stake in the company to 54 per cent. The company has a total equity capital of around Rs 41 crore.
Britannia Industries is expected to buy up to a maximum of 10 lakh shares, or 3.6 per cent of the equity capital, from the open market at a maximum price of Rs 750 per share. This will hike the promoter's holding in the company to 45.5 per cent. The company's outflow for the purpose will not exceed Rs 55 crore.
The shareholders of both the companies approved the buyback schemes at their respective annual general meetings.
As of March 2001, the promoters' holding in Bombay Dyeing was 40.14 per cent. The public holds 26.29 per cent, financial institutions and mutual funds hold 18.03 per cent, GDRs hold 2.73 per cent, while private bodies and corporates hold 12.02 per cent.
In Britannia, the promoters -- the Wadias and their collaborators, the France-based Groupe Danone, together hold 44 per cent stake.
Bombay Dyeing closed at Rs 38.05 on the BSE today against an opening of Rs 39.40. As many as 22,234 shares changed hands during the day.
Britannia closed the day at Rs 551, after touching an intra day low of Rs 547. Up to 10,755 scrips were traded.
