Tube Investments of India Ltd has initiated the process of making a public offer to acquire up to 2.12 crore shares of Shanthi Gears Ltd, Coimbatore, by making a detailed public statement in the media.

Tube Investments had already struck a deal to buy out the 44.12 per cent stake held by the promoter's group in Shanthi Gears at Rs 81 a share for 3.60 crore shares valued at Rs 292 crore. The public offer is made at the same price.

The statement issued by Enam Securities Pvt Ltd (Manager to the offer) on behalf of Tube Investments (the acquirer) to the Shanthi Gears shareholders said the acquirer was making an open offer to acquire up to 2.12 crore equity shares of Re 1 each at Rs 81 a share payable in cash.

This represented in aggregate 26 per cent of SGL's share capital.

On completion of the open offer and after full acceptance of the shares offered, Tube Investments would hold a maximum of 5.72 crore equity shares constituting 70.12 per cent of the equity capital of Shanthi Gears, which stands at Rs 8.17 crore.

The total funds required for implementation of the offer (assuming full acceptance) worked out to about Rs 172.09 crore. The total cost of acquisition, including the promoter's holding, would work out to Rs 464 crore.

Tube Investments has spelt out the timeline for completion of the open offer process beginning with the publication of DPS on July 20.

The Letter of Offer would be dispatched to shareholders by August 29. T

he offer would open on September 5 and close on September 18. The final report would be submitted to SEBI on October 8.

(This article was published in the Business Line print edition dated July 22, 2012)
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