Dema Glass Decides To Sell Cg Glass Pie

Royal Philips Electronics NV's plan to delist C G Glass from the bourses has received a fillip with Dema Glass deciding to sell its 6.78 per cent stake in the company. The Dutch consumer electronics major has made an open offer for 53.2 per cent stake in C G Glass following Royal Philips' 46.8 per cent acquisition.

Sources at DSP Merrill Lynch, Philips' financial advisors to the transaction, said: "Dema Glass, which holds about seven per cent in C G Glass, has decided to participate in the open offer. The response to the open offer has been quite encouraging and based on the current trend, we expect Royal Philips will be able to achieve a 90 per cent stake in C G Glass by the end of the open offer."

 

Royal Philips has made an open offer for the outstanding 53.2 per cent equity shares of C G Glass from the public at a price of Rs 13.75 per share. The offer opened on September 12 and will close on October 11. In July, Philips entered into an agreement with Crompton Greaves (28.8 per cent) and CDC Group Plc (18 per cent) of London to acquire their entire stake in the company.

Under the stock exchange listing rules, if the promoters acquire 90 per cent in a company they can delist it from the bourses. As per the law, after the closing date of the open offer, the company has to provide one more opportunity to shareholders within three months and only then can the company be delisted. Royal Philips aims to gain a 100 per cent ownership in the company.

C G Glass, which produces glass shells, tubular sheets and glass tubing, sells a substantial portion of its output to Philips India's lighting division. The company, which has a total paid-up equity base of Rs 18 crore, has recorded cumulative losses of Rs 40 crore over the past few years.