Premier Mills for delisting

NEW DELHI, NOV 4: The promoters of the Rs 250 crore premier mills have offered to buy back 20 per cent of the company's shares at a price...

NEW DELHI, NOV 4: The promoters of the Rs 250 crore premier mills have offered to buy back 20 per cent of the company8217;s shares at a price of Rs 60 per share from the public to raise their stake to over 90 per cent.

The promoters along with Primera Investments, which has made the open offer, currently hold 72.64 per cent stake in Tamil Nadu-based Premier Mills. The promoters would delist the shares from stock exchanges if the public holding falls to 10 per cent or less after the offer closes on January 20, 2000, the open offer for the company by Alpic Investment Services said.

The offer is for acquiring 9,60,000 shares of Premier Mills at a total cost of Rs 5.76 crore. Alpic Investment, the merchant banker for the offer, said Primera Investments would make another offer to buyout the remaining shares if the public holding in the company drops to 10 per cent or below after the current offer opening on December 22. Primera Investments has acquired 2.76 per cent in Premier Mills at a uniform price of Rs 52.50 per share since April 12, 1999.

The current offer price of Rs 60 per share is 75.49 per cent higher than the last 26 weeks average of weekly high and low of the closing prices of Premier Mills quoted on Madras Stock Exchange MSE and more than the price paid by the acquirer for the previous acquisitions, Alpic said.

Promoters of primera 8211; R jagadish chandran and DRajendran 8211; are also associated with premier mills as promoters. Premier mills, which is listed on the MSE, is engaged intextile business and reported a net profit Rs 8.70 crore in 1998-99.

Premier Mills had transferred its export-oriented spinning unit at Pulankinar, which accounts for about 37 per cent of the company8217;s turnover, to its wholly-owned subsidiary premier fine yarns ltd in April this year. Alpic said the promoters did not have any plans to dispose off any assets of Premier Mills in the next two years, except in the ordinary course of business.

The promoters have deposited Rs 1.44 crore representing 25 per cent of the offer in an escrow account last month with bank of baroda branch at Coimbatore, the offer said.

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This was done as per the takeover regulations of Securities and Exchange Board of India SEBI. The offer is subject to statutory approvals undercompanies act, foreign exchange regulation act and monopolies and restrictive trade practices act.

The acquirer will make an application to the Reserve Bank of India RBI on behalf of non-resident shareholders for the permission to acquire the shares held by them.

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