Gujarat Foils faces takeover, again

June 6th, 2008 - 3:52 pm ICT by IANS  

By P.S. Anantharaman
Ahmedabad, June 6 (IANS) The Rs.950 million Gujarat Foils Ltd is being targeted again, the second time since it was founded in 1992. Abhay Lodha, chairman of the Mumbai-based Rs.8,000 million Topworth group of Industries, has made an open offer to minority shareholders to acquire their shares at Rs.144 per share of Rs.10 each.

The offer was to open for subscription June 10, but in a communication posted on the Bombay Stock Exchange, the date has been revised to June 17. The offer will close July 7 instead of June 30 as stipulated earlier. No reason was given for the change.

Lodha could end up with a controlling 60 percent stake in Gujarat Foils, as he already holds around 44 percent, and the open offer amounts to acquiring a further 20 percent stake in the company. Under SEBI’s takeover code rules, the minimum level of public holding in a company has to be 25 percent, and Lodha has committed to raise that in the event of any shortfall.

When the deal is fully completed, it would have cost Lodha Rs.560 million.

Gujarat Foils - which saw its sales dropping to Rs.950 million in 2007-08 from Rs.1,030 million the previous year - manufactures aluminium rolled products at its plant at Chhatral on the Ahmedabad-Delhi National Highway.

It also exports to West Asia.

The company, floated in 1992, was soon after acquired by Pramod Jain, its current owner. In 1995, it went public that saw Jain and his associates raise their stake to 67.26 percent. The balance was held by the public.

Neither Jain nor Lodha were available for comment.

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