Financial Daily from THE HINDU group of publications
Wednesday, May 10, 2006
Financial Daily from THE HINDU group of publications Wednesday, May 10, 2006 |
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Automobile Components Corporate - Mergers & Acquisitions Federal Mogul makes fresh bid to increase stake in Goetze Our Bureau
New Delhi , May 9 American auto components major Federal Mogul Corporation on Tuesday made a renewed bid for acquiring an additional 24.64 per cent stake in Goetze India Ltd (GIL) and offered Rs 222.5 per equity share against the Rs 205-215 price-band proposed earlier. "The mode of the proposed acquisition will be off-market inter se promoter transfer. The acquisition price per share will be Rs 222.50 and the date of proposed acquisition would be on or after May 12," the company said. Federal Mogul Corporation said the bid to acquire 24.64 per cent of the share capital of Goetze India from the Anil Nanda-promoted Joint Investments Pvt Ltd would be carried out by Federal-Mogul Holding Ltd. If successful, the acquisition will give Federal Mogul a 50.10 per cent holding in the company.
Positive development
Speaking to Business Line, Mr Anil Nanda, Chairman and Managing Director, Goetze India, said that following the transaction his share in the company would decrease to about six per cent. "We expect the deal to materialise in a week's time. It is a positive development for the company," he said adding that the deal would help the company to get access to technology from the American components major. "The products of Goetze India are technology driven and to take the company forward, Federal Mogul needs to have control," Mr Nanda said. Post the completion of the transaction, Federal Mogul is likely to step up sourcing from Goetze as well as infuse more funds. The transaction, valued at about Rs 140 crore, would not trigger an open offer as it is an inter se transaction. Mr Nanda is likely to continue as non-executive chairman of Goetze India. Further, he has recently entered into newer businesses such as real estate, wind energy and medical equipments. After its unsuccessful bid earlier in March this year, Federal Mogul had said it was "reassessing its strategy" with respect to Goetze India. Meanwhile, the share of Goetze, which opened at Rs 245.54 at the Bombay Stock Exchange, jumped almost 20 per cent to close at Rs 305.30 on Tuesday. Mr Nanda was given controlling interest in Goetze India in January 2003 following his parting ways with elder brother Mr Rajan Nanda, Chairman and Managing Director of Escorts Ltd.
Related Stories: More Stories on : Automobile Components | Mergers & Acquisitions
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