Deepak Fertilisers buys 10 lakh MFCL shares for Rs 6.26 crore

Deepak Fertilisers, the company that's made a hostile bid for control of Vijay Mallya-promoted Mangalore Chemicals and Fertilizers Ltd (MCFL), today said its stake in the company increased to 25.3 per cent after buying additional shares for about Rs 6.26 crore.
"SCM Soilfert Ltd (SSL), a wholly owned subsidiary of the company, has acquired...10,01,309 equity shares, representing 0.84 per cent of share capital of MCFL," Deepak Fertilisers and Petrochemicals Corporation Ltd said in a BSE filing.
The shares were bought at an average price of Rs 62.50 each, according to the filing. Following the transaction, Deepak Fertilisers said its subsidiary holds 2,99,92,459 shares in MCFL and its stake increased to 25.31 per cent from 24.5 per cent.

Deepak Fertilisers yesterday launched a hostile takeover bid for MCFL, proposing to purchase an additional 20 lakh shares and making an open offer to buy another 26 per cent stake for about Rs 190 crore. The open offer was triggered after its holding crossed the 25 per cent threshold.
"Subsequent to the said purchase, SSL has issued public announcement...For open offer for acquisition of up to 30,813,939 equity shares of MCFL," the filing added.
MCFL shares gained 6.62 per cent to Rs 66.05 on the BSE yesterday. The stock markets in Mumbai are closed today on account of the Lok Sabha elections.

If the open offer succeeds, Deepak Fertilisers will wrest control of MCFL, which belongs to the debt-ridden UB Group and owns and operates urea and chemical plants at New Mangalore port in Karnataka.

JM Financial Institutional Securities Ltd is managing the open offer for Deepak Fertilisers, which is acquiring the MCFL shares along with SCM Soilfert.
Deepak Fertilisers 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.
Last year, Zuari bought a 16.43 per cent stake in MCFL and Deepak Fertilisers purchased 24.46 per cent.

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.
The UB Group holds about 22 per cent in MCFL. A UB spokesperson yesterday said: "We will study the offer, review our options and respond accordingly.