The Hindu Business Line : Deccan Gold: Sun Mining opts out of warrant conversion

Kolkata, Nov. 5 Sun Mining and Exploration Ltd, a Cyprus-located investment vehicle of Delhi-based private equity player Sun group, has not opted for conversion of warrants into equity shares in Deccan Gold. It was issued 1,10,77,027 convertible warrants at a price of Rs 15.10 per warrant on May 1, 2006. The warrants conversion time limit expired on October 31, 2007. Deccan Gold has forfeited upfront payment of Rs 1.67 crore, made by Sun for warrants. The decision by Sun assumes importance following non-filling of its second board berth, which fell vacant after resignation of Mr Taveesh Pandey, Sun’s former CIO, on September 21 last.

Currently, Sun group’s country head, Mr Vaidyanathan Sivakumar, is now the lone representative of the group on the Deccan’s board. Deccan Gold, the only listed company with gold prospecting licences, is promoted by Australian Indian Resources Pty (AIR), through Rama Mines (Mauritius) Ltd. Conversion of warrants could have brought up the status of Sun group as the co-promoter of Deccan Gold.

In May 2006, Sun Group invested Rs 10.57 crore in Deccan for acquisition of 70 lakh shares of Re 1 each at a premium of Rs 14.10 per share through Sun Mining & Exploration. Sun Group currently holds 11.98 per cent in Deccan. As on September 30, AIR’s holding stood at 58.41 per cent, down from 69.21 per cent, before Sun’s entry last year.

The stock finished at Rs 26.95, with a 5 per cent gain. In the past one week, the stock gained over 27 per cent and in the last one month, it has gained by 39.64 per cent.

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