Mumbai, Jan. 5: The battle for control of Fame India has reached an interesting stage with Reliance MediaWorks, the Anil Ambani group company, reportedly mopping up around 32 per cent in an open offer that takes its stake to nearly 44 per cent.
It may be recalled that both Reliance MediaWorks and Inox Leisure had announced their open offers last month to wrest control of the multiplex operator.
Inox had offered the shareholders of Fame India a price of Rs 51 per share that valued its offer size at nearly Rs 42 crore. The Anil Ambani group company topped it with an offer of Rs 83.40 per share. Both offers closed on January 4 after commencing on December 16.
Sources say the open offer from Reliance MediaWorks received a very good response, which will give it around 44 per cent of the emerging equity share capital of the company. A company spokesperson refused to confirm the development.
The open offer size of Reliance MediaWorks was of 2,17,00,000 shares and the emerging equity share capital of the company. Earlier, the equity capital of Fame India saw an increase as the company issued shares to its employees under the stock option scheme.
Fame India has also received an early redemption request for certain foreign currency convertible bonds (FCCBs) equivalent to 5.01 lakh shares, which may result in additional equity as well.
While an official announcement from Reliance MediaWorks on its stake in Fame India is expected over the next few days, its shareholding in the company does signal interesting developments ahead. The Anil Ambani-group firm may seek representation on Fames board.
The additional equity that may come as a result of the FCCB conversion may see the stakes of both the companies coming down.
At present, Inox holds a little over 50 per cent in Fame India.
The battle for Fame began when its promoters sold a 43 per cent stake to Inox for Rs 44 per share. Subsequently, Inox picked up a 7 per cent stake in Fame from the market and took its stake to over 50 per cent. Inox thereafter made the mandatory open offer for an additional 20 per cent at Rs 51 per share.
Reliance MediaWorks riposted with a higher price.
Reports of Reliance MediaWorks increasing its stake in Fame India via the open offer today saw shares of the latter hitting the upper circuit. On the Bombay Stock Exchange, the share closed at Rs 91.80, a gain of Rs 15.10, or 19.69 per cent.