Raasi Cement executive chairman B V Raju is prepared to make a counter-offer if India Cements persists in its attempt to take over his company. Discussing India Cements takeover bid, Raju told Business Standard that he could not be ousted as he was comfortably placed with regard to his equity holding.
He said the present management of Raasi Cement was known to be progressive and had instituted several welfare projects in the factory area. Relations between the management and workers were cordial, the cost of production was low and the management was known to run the factory efficiently, he claimed. Raju said he was confident the financial institutions, government and shareholders would stand by the present management.
It is learnt that Raju has been moving cautiously ever since India Cements plans to take over Raasi surfaced in December. He began negotiating with the FIs and is known to have acquired 12.5 per cent out of the 25 per cent held by these institutions.
Raju is understood to have told close friends that he holds 45-47 per cent in Raasi while his associates hold another seven per cent. After acquiring 12.5 per cent of the financial institutions, he is comfortably placed. Therefore, even if India Cements acquires the 20 per cent for which it has made an open offer, there is no danger of the company changing hands.
The new crisis has surfaced following the sale of 13.50 lakh shares, comprising 8.28 per cent of Raasi Cements equity, by Rajus son-in-law and executive vice-president and managing director of Raasi Cements, N K P Raju, his son N Sri Vishnu Raju and others, to India Cements earlier this week.
Incidentally, when The Smart Investor, Business Standards weekly investment supplement, had carried a report on differences within the Raju family in its January 5 issue, both N K P Raju and B V Raju had issued a denial.
N K P Raju and India Cements vice-chairman and managing director N Srinivasan are known to have been good friends for over 30 years. B V Raju is also said to be a good friend of Srinivasan.
Ironically, India Cements had purchased a sizeable number of Raasi shares a few years ago at B V Rajus instance, when the promoters feared a similar takeover bid by Kotak Mahindra.
However, relations between the two companies began to soar thereafter. As India Cements acquired more Raaasi shares, the latter refused to register them on the ground that it would be prejudicial to the companys interests.
Raasi Cement recently wrote to India Cements that a substantial portion of the shares held by them were covered by a stop-transfer instruction from registered shareholders and a status quo order by a city court.
Raasi has also informed the Hyderabad SE that Lakshmipriya Investments, along with two others, had filed a suit regarding 3.35 lakh shares pledged with Kotak Mahindra Finance Ltd and obtained a status quo order. Raasi Cement explained that of the 3.35 lakh shares, it had received 2,12,200 shares from a transferee and the same were returned to them on different grounds.
