Deepak Fertilisers on Wednesday launched a hostile bid for Vijay Mallya - promoted Mangalore Chemicals and Fertilizers Ltd ( MCFL), raising its stake in the company to over 25 per cent.
The company has also made an open offer to pick up another 26 per cent share for Rs 190 crore.
If the open offer to shareholders comes through, Sailesh Mehta- led Deepak Fertilisers will be able to take control of MCFL. Deepak Fertiliser has been locked in a corporate war with Saroj Poddar- run Zuari Fertilisers for about a year for the control of MCFL, which had sales of Rs 2,779.59 crore in 2012- 13.
Deepak Fertilisers and Petrochemicals Corporation, the largest shareholder of MCFL, o Wednesday bought 10,00,034 BSE through subsidiary SCM Soilfert Ltd, according to stock market data.
Deepak Fertilisers' stake in MCFL has now gone up from 24.46 per cent to more than 25 per cent, the threshold for making an open offer in accordance with Securities and Exchange Board of India ( Sebi) norms.
Earlier in the day, Deepak Fertilisers informed the Bombay Stock Exchange ( BSE) that it had placed an order to buy up to 20 lakh shares, equivalent to a 1.7 per cent of stake in MCFL, at Rs 63 a share.
If the company is able to buy the entire 20 26.1 per cent.
Deepak Fertilisers also announced an open offer to acquire up to 3.08 crore MCFL shares, comprising 26 per cent of the Mallya firm's equity, at Rs 61.75 a share, aggregating Rs 190.27 crore.
The promoter UB Group holds about 22 per cent in MCFL. Last year, Zuari bought a 16.43 per cent stake in MCFL and Deepak Fertilisers purchased 24.46 per cent. The three companies compete in the fertiliser business, but the huge debt burden of the Mallya- led group has led to speculation about MCFL being an apparent takeover target.
MCFL shares ended the day 6.62 per cent higher at Rs 66.05 on the BSE, retreating from gains of as much as 16.78 per cent during the day to Rs 72.35. Shares of Deepak Fertilisers rose 4.07 per cent to Rs 125.15 on the BSE.