Mangalore Chemicals Soars 15% on Zuari Open Offer

Shares of Mangalore Chemicals and Fertilizers (MCFL) soared over 15 per cent on the NSE to Rs 99.9 after Zuari group announced a voluntary open offer.

The open offer price of Rs 91.92/share represents about 7 per cent premium to Mangalore Chemicals' Thursday closing price of Rs 86.40.

Kolkata-based industrialist Saroj Poddar-led Zuari group will spend up to Rs 282.19 crore to buy over 3 crore shares in UB Group firm MCFL through a new open offer. This constitutes 25.90 per cent of the MCFL's fully diluted voting equity share capital.

This open offer again sets the stage for another bidding war for control of MCFL, which has been a target of an intense takeover battle between Zuari group and Pune-based Deepak Fertilisers.

In the battle for control of MCFL, UB Group has sided with Zuari group and they had earlier launched a counter offer after Deepak Fertilizers came out with an open offer.

After open offers of both Deepak and rival Zuari-UB Group closed on October 20, Deepak Fertilisers' stake in MCFL increased by about 6 per cent to about 32 per cent and inched closer towards the rival Zuari-UB group's combined stake of 38.4 per cent.

The battle for MCFL between Deepak Fertilisers and Zuari Group was triggered in April 2013 when the latter bought about 10 per cent stake in MCFL through open market.

Later, Deepak Fertilisers acquired 24.46 per cent stake in MCFL in one go in July 2013. After this, Zuari group had increased its stake to 16.43 per cent in the same month.

Mangalore Chemicals on Thursday announced appointment of UB group chairman Vijay Mallya's step-mother Ritu Mallya as a director of the firm with immediate effect. In a surprise move on December 1, liquor baron Mallya had resigned as MCFL director.

At 11:21 am, Mangalore Chemicals shares were up 7.5 per cent to Rs 92.95.

(With Agency Inputs)