Orissa Sponge in the thick of stake war again

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Bhushan Power’s new offer triggers Bhushan Energy, Monnet Ispat to act

It seems another season of three-year-long multi-corner battle for control of Orissa Sponge Iron & Steel Ltd has begun all over again.

Bhushan Energy Ltd, a second suitor for the company with mineral resources, has thrown its gauntlet once more on Tuesday after Bhushan Power & Steel Ltd on Monday renewed its battle cry.

Monnet Ispat & Energy Ltd, the other contender, has also joined the fray with its offer, also for the same period — from June 28 to July 17.Monnet and Bhushan Power’s may buy a share of Orissa Sponge for Rs 310 and Rs 300 respectively.Bhushan Energy along with PACs (person action in concert) said they would reopen their open offer for 20 per cent stake in Orissa Sponge. Incidentally, the offer period of Bhushan Energy and Bhushan Power is same.

IDFC Capital Ltd, manager to the offer of Bhushan Energy said, the company along with PACs had earlier through a Letter of Offer to the shareholders of Orissa Sponge offered to buy up to 61 lakh shares at a price of Rs 360 a share. Bhushan Energy had said in 2009 April that the offer followed a Supreme Court order of March 26, 2009, on an interim application relating to non-conversion of 35 lakh warrants.

Then Chief Justice, Mr S.H. Kapadia, in July 2008 had dismissed a petition from Bhushan Energy to direct Orissa Sponge to convert the warrants.

Meanwhile, Monnet Ispat group backed the promoters of Orissa Sponge against the bids from two Bhushan factions.

The Orissa Sponge’s closed at Rs 371 on Tuesday, down 1.12 per cent on the BSE.


(This article was published in the Business Line print edition dated June 27, 2012)
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