Deepak Fertilisers sells 2.2% stake in Mangalore Chemicals

Post the sale, Deepak Fertilisers' stake has come down to 29.05%

In a surprise move, Deepak Fertilisers, which is fighting to take control of Mangalore Chemicals and Fertilisers Ltd (MCFL), sold a 2.2% stake in the Vijay Mallya-led fertiliser firm.

Pune-based Deepak Fertilisers has been competing with industrialist Saroj Poddar-led Zuari group for taking control of the MCFL since July 2013.

In a filing to the BSE, Deepak Fertilisers informed that it has sold over 26 lakh shares, representing 2.2% stake in MCFL, during last month through nine different open market transactions.

Post sale of 26 lakh shares, Deepak Fertilisers' stake in MCFL has come down to 29.05% from 31.25% stake earlier. Pune based company held these shares through its subsidiary SCM Soilfert Ltd.

When contacted, company's spokesperson declined to comment on the reason behind offloading of the shares.

However, sources said Deepak Fertilisers is still in the race and all options are open. They also added that Deepak continues to remain largest shareholder in MCFL.

At present, UB group has 21.97% stake and Zuari group has 16.47% stake in the MCFL.

The announcement comes a week after Zuari group revised its open offer size to 4,33,29,000 equity shares representing 36.56% of the total share capital of MCFL.

Zuari had retained the price of open offer at Rs 91.92 per share.

With increase in the offer size, Zuari group would now have to spend Rs 398.2 crore from the earlier Rs 282.19 crore.

The battle for takeover of MCFL was triggered in April 2013 when Zuari group bought about 10% stake in MCFL through open market.

Later, Deepak Fertilisers acquired 24.46% stake in MCFL in one go in July 2013. After that, Zuari group had increased its stake to 16.43% in the same month.

Deepak Fertilisers further raised its stake in MCFL in April 2014, triggering the need for launch of mandatory open offer.

Vijay Mallya-led UB group had sided with Zuari group to launch the counter open offer, which opened on October 1 and closed on October 20, to ward off the takeover bid of Deepak Fertilizers.

In that open offer, Zuari group was able to buy only 42,424 shares as its offer price was lower than Deepak Fertlisers' offer price of Rs 93.60 per share.

However, Deepak Fertilisers was able to raise its stake in MCFL by about 6% to 31.25%.