Titagarh Wagons Ltd, which last month increased its ownership in Cimmco to around 74.2 per cent through conversion of debentures into equity, has now made an open offer for the remaining stake. VC Corporate Advisors, manager to the offer, said the offer will open on June 10 and close on June 23.

TWL offered to buy a 25.8 per cent stake in Cimmco at a price of ₹15.50 a share of ₹10 each.

Full acceptance of the offer would mean an acquisition cost of ₹7.83 crore. The debenture conversion had cost TWL ₹64 crore.

TWL is also picking up non-cumulative redeemable preference shares worth ₹50 crore in Cimmco on a private placement basis.

The preference shares would not, however, change the holding pattern further.

The debenture conversion and acquisition would turn Cimmco a direct subsidiary of TWL, also a wagon maker.

Management sources told Business Line that Cimmco would remain listed. This would mean a fresh process of divestment by the TWL to meet SEBI’s minimum shareholding norm.

Among the Cimmco public stakeholders are ARCIL (6.6 per cent) and ICICI Bank 2.49 per cent).

Originally an SK Birla outfit, TWL had turned a co-owner of Cimmco following a BIFR order in March 2010. Though Cimmco came out of purview of BIFR in just about nine months after the sanction of rehabilitation scheme, it is still not out of woods for decline in wagon procurement by the Indian Railways.

On Friday, Cimmco shares closed at ₹25.50, down 2 per cent, on the BSE.

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