Essel Group stake close to IVRCL promoter-holding level

Subhash Chandra-led Essel Group has bought additional shares in infrastructure company IVRCL to bring its shareholding close to 11%, the level held by promoters led by E Sudhir Reddy.

Market analysts said there is risk of control of the company changing hands. According to brokerage firm Zen Securities, the stake held by IVRCL promoters is very less and "if they do not take this seriously there is risk of taking over control of the company".

IVRCL, however, sounded confident of support from financial institutions and lenders. "I have received messages from other infrastructure companies willing to extend support and personally chairmen of some banks also said they will help, if required," IVRCL Chief Financial Officer Balram Reddy told PTI.

"Our chairman is having talks with other FIIs and (we are) fully backed up. We are ready to resist the move to any extent," Reddy added.

Essel Group had yesterday said that it had hiked its stake in IVRCL to 10.19%. It had added that it was keen to hike the holding further.

Promoters of IVRCL held 11.18% stake in the company while FIIs and DIIs held 37.11% and 5.4% respectively as per the shareholding pattern recorded on December 31, 2011. The rest was with public.

According to Sebi's new guidelines, the takeover trigger limit has been increased from 15% to 25%.

Essel's stake acquisition in IVRCL through secondary market triggered the possible takeover threat fuelled by its statement.

"In line with its philosophy to grow its infrastructure business to match and benefit from the rising proportion of infrastructure investment by India, the Essel Group has acquired a 10.19% stake in IVRCL and is keen to increase it and is in the process of increasing it," Essel had said in a statement.

IVRCL reported net profit of Rs 6.79 crore for the third quarter ended December 31, 2011 down 84% over the same quarter last year. Its total income decreased by 15% to nearly Rs 1,203 crore in the quarter.

Shares of the company were trading higher by 6.1% at Rs 63.75 on the BSE today.