The Telegraph
Since 1st March, 1999
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Promoters of BSL to raise stake to 42%

Calcutta, Sept. 19: The promoters of BSL Ltd intend to raise their stake past 42 per cent by way of creeping acquisition by September 30 — the day the Sardas’ open offer for 30 per cent of the company’s shares, opens.

If the promoters of BSL — the Jhunjhunwala and Churiwal families — manage to do so, they are sure to stave off the Sardas from wresting management control of the company. At least, for the time being.

The Sardas have acquired 11.86 per cent of BSL’s shares, and even if their open offer for 30 per cent is fully subscribed, their holding will not exceed 42 per cent.

Ravi Jhunjhunwala, one of the promoter-directors of BSL, said it was the strategic intent of the management of the company to raise their shareholding as much as possible by September 30.

“The threshold on creeping acquisition (in a year) is 10 per cent till September-end, and we intend to make best use of it. I cannot give a precise estimate of how much more we can acquire within this month, but I’d imagine we can raise our stake past 42 per cent in any case,” he said.

The promoters held around 37 per cent at the end of June. They have since increased their stake by buying shares from the market, and their current holding is believed to be close to 40 per cent.

In a related development, the BSL management has pointed out to the Securities and Exchange Board of India (Sebi) more than half-a-dozen irregularities in the offer document filed by the Sardas.

“We have pointed out 7-8 irregularities in the offer document. We are scrutinising it, and over the next few days, will present a detailed note on all the contentious points in it,” Jhunjhunwala said.

Sebi has already asked SBI Capital Markets — the merchant banker managing the open offer for the Sardas — to clarify a number of issues. The Sardas said they would answer the questions within a day or two, but denied putting any incorrect information in the offer document.

Besides alleging that the offer document was not sent to BSL in time for the management to consider a counter-offer, the company told Sebi that some of the firms of the Sardas had “overstated their net worth”.

“What is even more interesting is the statement of shareholding of one of the acquiring firms, Namokar Vinimay Pvt Ltd. According to the offer document, one of the promoter companies of BSL has substantial stake in Namokar Vinimay.

“This, if correct, implies that one of our group companies is indirectly acting in concert with the Sardas in their hostile bid for BSL. This is absolute rubbish,” Jhunjhunwala said.

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