Indal takeover war hots up; FIs call meet

MUMBAI, May 26: The takeover battle for Indian Aluminium (Indal) has intensified with both Alcan of Canada and Sterlite Industries taking th...

MUMBAI, May 26: The takeover battle for Indian Aluminium (Indal) has intensified with both Alcan of Canada and Sterlite Industries taking the matter to the Securities and Exchange Board of India (SEBI). The merchant bankers of Sterlite met top SEBI officials on Tuesday to present their case following a complaint filed by Alcan on Monday.

Meanwhile, a high level meeting of financial institutions, having equity and debt exposure in Indal and Sterlite, has been convened to discuss the repurcussions of Sterlite’s offer on both companies and arrive at a final decision. Alcan had petitioned to the SEBI on Monday saying that Sterlite has presumed Department of Company Affairs (DCA) and shareholders approval for the Rs 818 crore investment in Indal instead of obtaining it before the closing of the offer on June 2. Alcan added that the company has also changed the `objective’ of the open offer by planning to buy a stake of 52 per cent instead of original 20 per cent offer.

Sterlite’s had announced on Monday thatit is convening an extraordinary general meeting (EGM) on June 12 to seek shareholders approval for making an investment of over 30 per cent of its net owned funds in Indal. Sterlite sources say that its Sunday’s Rs 221 offer is conforming to all the SEBI’s regulations and, if necessary, they are ready for a court battle. There were rumours that if Alcan fails in its objective to convinve the regulatory body on this issue, it will move courts.

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"We have deposited all the funds into the Escrow account and answered all the queries raised by the SEBI," said an official of Enam Financial. "Now we are waiting for FI reactions," he added.

FIs hold the key to the entire takeover drama with over 36 per cent stake in the company. Sources say that Sterlite has highlighted to the FIs the absence of any official intimation by FIPB to Alcan for investing in Indal. FIs are also waiting for either of the companies to make an offer of a negotiated deal.

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