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| Laxey exits Hirco after long fight with Hiranandanis |
| Raghavendra Kamath / Mumbai Jul 03, 2009, 01:03 IST |
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 After a long-drawn fight with real estate player Hiranandani over its investment vehicle Hirco Plc, Laxey Partners — an activist shareholder in the company — exited its investment by selling its entire stake in Hirco to global investor HSBC on Wednesday.
Laxey sold the shares at 95 pence per share for a total consideration of ¤8.72 million, or Rs 68 crore. After this transaction, HSBC’s stake in the company will rise to 21 per cent from the earlier level of 9.9 per cent. Laxey held around 12 per cent of the London’s Alternative Investment Market-listed Hirco’s equity, or 9.1 million shares in the company.
On May 7, at Hirco’s extraordinary general body meeting, Hirco Chairman Niranjan Hiranandani had emerged the winner in the battle with Laxey as 60 per cent of the shareholders voted against Laxey’s proposals to remove three directors of Hirco and replace them with its own nominees. Laxey had also demanded that Hirco name a chairman who was independent of the Hiranandani family.
Earlier, Hirco had to defer a plan for a reverse takeover of the Hiranandani group companies Hirco Developments and Hiranandani Investment Companies with itself following a backlash among investors led by Laxey, which described the proposal as "shocking and ill-conceived”.
"We sold it because we made money and it made sense. We are concerned about a number of issues regarding the developments, the permits and what stage of development they are really at," Colin Kingsnorth, non-executive director of Laxey Partners, an Isle of Man-registered hedge fund, said.
Hiranandani declined to comment on the transaction.
Laxey and Hiranandanis were involved in a bitter fight over the last six months regarding the reverse merger of Hiranandani's development companies in India with Hirco and ouster of Hiranandani-nominated directors.
“We wish them good luck and feel confident that our actions raised issues that will improve the corporate governance of the company. We believe they still want to merge the company with their developer and we didn't feel comfortable with that,” Kingsnorth added.
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