Deepak Fert open to joint management control of MCF

Reports say Zuari Agro Chairman Saroj Poddar might jointly counter Deepak Fertiliser's attempt to corner majority stake in MCF via open offer

Deepak Fertilisers is keeping its options open for a proposal to jointly control the management of Mangalore Chemicals and Fertilizers (MCF) with promoter Vijay Mallya.

“Deepak is open to any joint running or management proposal with Mallya for MCF. The open offer is also under not-for-control clause,” a source close to development said.

Steps to open a negotiation channel with Mallya is significant after reports that Saroj Poddar, chairman of Zuari Agro, which owns 16.5 per cent in MCF, might jointly counter Deepak’s bid to corner a majority stake via open offer.

Deepak Fertilisers raised its stake in MCF beyond 26 per cent with a recent open-market purchase, which triggered the mandatory open offer.

Asked for a comment on the issue, a spokesperson said Deepak Fertilisers did not respond to market rumours and speculations.

Zuari Agro held close to 16.5% and sources said its management had intense meetings for the last few days to chart out the next course of action in the takeover war.

Poddar, after the open offer was announced, had told PTI that he was not yet out of the race and was weighing options and monitoring developments closely.

Brokers were not enthusiast about the success of the Deepak Fertiliser's open offer at Rs 63 at the time when market price was hovering over Rs 70 a share.

"It is unlikely that the open offer will get subscribed at current price of Rs 63," senior stock broker Sidhharth Thirani said.

MCF will provide Deepak Fertilisers entry into urea manufacturing and access to the new markets like southern India.

The west India based fertiliser major manufactured complex fertilisers, and with better product mix, it could address the wider market of agriculture.

Poddar had also mentioned the synergies the company could offer for healthy growth of MCF.