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Friday, Sep 13, 2002

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Widia India open offer likely soon

Ambarish Mukherjee

NEW DELHI, Sept. 12

WIDIA India Ltd is planning to come out with an open offer to mop up shares held by the Indian public. Though the exact date is yet to be finalised, sources familiar with the developments said that it could be sometime during the third quarter this year.

The move is part of the change in management of Widia group globally. The open offer will be announced during the course of this year, according to official sources.

The move follows buying out of the Indian partners by the Swiss parent recently. The Swiss parent, Meturit AG, on August 30 had acquired 56,44,920 equity shares of Rs 10 each accounting for 25.77 per cent stake held by the Indian promoters, namely SAK Industries promoted by Mr Autar Krishna. However, the exact valuation of the deal has not been disclosed.

Earlier, Meturit AG held 51 per cent stake in the company, which has now gone up to 76.76 per cent after the acquisition.

Widia India is a subsidiary of Switzerland-based Meturit AG, a 100 per cent subsidiary of Widia GmbH, which, in turn, is a subsidiary of Milacron Inc of the US.

Milacron had signed an agreement with Kennametal Inc of the US to sell out Widia GmbH and Widia India for $170 million (Rs 816 crore). Both Milacron and Kennametal are listed on the New York Stock Exchange (NYSE).

Kennametal has funded the acquisition through a comprehensive refinancing scheme of its capital structure, which includes a new three-year revolving credit facility, public term debt and issuance of $100 million to $150 million of equity. Established in 1966, Widia India is one of the oldest listed companies in the country and is the current market leader in the domestic cutting tool industry with a market share of around 40 per cent.

Widia India shares are currently being quoted at around Rs 80 on the BSE. The 52-week high and low of the scrip are Rs 147 and Rs 42, respectively. The current market capitalisation of the company stands at around Rs 176 crore.

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