Parents Open Offer Plan Lifts Indal

Indal witnessed a 4.09 per cent rise in its share price at Rs 115.75 following reports that the company's parent Hindalco is planning to make an open offer to acquire 100 per cent in the company.

The Indal shares clocked a volume of 95,496 on the Bombay Stock Exchange (BSE) and 3.53 lakh shares on the National Stock Exchange (NSE).

Reports that Hindalco is considering a open offer for the remaining shares of Indal so that it can delist the company from domestic stock exchanges is pushing up the scrip.

Hindalco owns a 74.6 per cent stake in Indal, while public and institutions hold 8.64 per cent and 12.64 per cent, respectively.

 

Hindalco proposes to make an open offer at a price of Rs 120 per share, which is at a 2.12 per cent premium over the current price.

It may be recalled that the A V Birla group's flagship Hindalco Industries (Hindalco) acquired a majority stake of 54.62 per cent in Indal from Alcan Aluminium, Canada, last year.

It acquired an additional 20 per cent stake pursuant to the open offer under the Sebi (Substantial Acquisition of Shares and takeovers) Regulations, 1997.

Hindalco's holding now stands at 74.62 per cent of Indal's paid-up share capital. Recently, there were reports that Indal would be investing Rs 230 crore for the expansion of the Hirakud (Orissa) smelter to 57,000 tonne per annum (tpa), from the current 30,000 tpa.

The expansion is likely to be completed by March 31, 2003. The funds for the expansion project will be generated internally.

Alumina produced from Hirakud will be used for value addition in Indal's other downstream plants. Indal manufactures aluminium and its semi-fabricated products. Some of the products manufactured by it are alloys, architectural sections, barns, chequered plates, circles, coils, sheets, foils, stock silos, ingots and irrigation tubes.

Indal has two refineries at Muri in Jharkhand and Belgaum in Karnataka, an extrusion plant at Alupuram in Kerala, a sheet plant at Kalwa in Maharashtra and a cold-rolling mill at Belur in West Bengal.

Earlier this month, the A V Birla group aluminium major is said to have raised its equity stake in Utkal Alumina to 65 per cent. The company had earlier entered into an agreement with co-promoter Alcan of Canada to buy out the stake of Norway's Norsk Hydro in Utkal. Utkal is a Rs 1,000 crore, four-million tonne project based in Kashipur, Orissa.