Deepak Fert raises open offer price for MCFL to Rs 194 cr

Deepak Fertilisers has raised open offer price to Rs 63 per share, aggregating to Rs 194.12 crore, for acquiring another 26% stake in Vijay Mallya -promoted Mangalore Chemicals and Fertilizers Ltd (MCFL).

On April 23, Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPCL) had increased its stake to over 25% and made an open offer to buy another 26% for Rs 190 crore.

The company had acquired 10 lakh shares in MCFL and for about Rs 6.26 crore.

DFPCL and Saroj Poddar-led Zuari Fertilisers have been engaged in a tug-of-war for about a year for control of MCFL, which had sales of Rs 2,779.59 crore in 2012-13.

Following the open offer by DFPCL, advisory committee of Zuari group is scheduled to meet this week to discuss the future course of action, sources said.

"The offer price has been revised from Rs 61.75 per equity share at the time to Rs 63 per equity share... The offer price is subject to further revision, if any, pursuant to the SEBI (SAST) Regulations or at the discretion of the acquire," DFPCL has said in a BSE filing.

If the open offer to shareholders succeeds, DFPCL will wrest control of the firm that belongs to debt-ridden UB Group and owns and operates urea and chemical plants at New Mangalore port in Karnataka.

The promoter UB Group holds about 22% in MCFL. A UB spokesperson had earlier said: "We will study the offer, review our options and respond accordingly."

JM Financial Institutional Securities Ltd will manage the open offer for Deepak Fertilisers, which is acquiring the MCFL shares along with SCM Soilfert.

Last year, Zuari bought a 16.43% stake in MCFL and Deepak Fertilisers purchased 24.46%.

The three companies compete in the fertiliser business, but the huge debt burden of the Mallya-led group has led to speculation about MCFL being an apparent takeover target.

Any direct or indirect acquisition of shares amounting to a stake of 25% or more in a listed company triggers a mandatory open offer by the acquirer for additional shares.