Saroj Poddar will sell his 16 per cent stake in Mangalore Chemicals and Fertilisers to the highest bidder after December, if Vijay Mallya does not divest his 21 per cent to him or share management control.
The decision is an aftermath of his last round of discussions with Mallya in New Delhi in August.
“I need to protect interests of my group’s stakeholders. Vijay has changed his mind and appears unwilling to divest now. We will give him time until December to make up his mind. I will not force him to divest but sell-off the shares to the highest bidder,” Poddar told
Poddar has an agreement with Mallya. The agreement provides for first right for refusal to Poddar in case Mallya is divesting his stake and control in MCF.
Oddly enough, according to him, MCF’s Articles of Association provides that the current promoters have the right to appoint three directors if they hold 15 per cent or more. It is an unusual hurdle in the way of a takeover bid to have control over the company.
Poddar is willing to share control in a “friendly” way as an alternative. However, if things do not work out either way, then he is firm on selling off the shares and making a profit. “In Nagarjuna Fertiliser, our friendly takeover attempt did not work out. But as we sold off the acquired shares we made a profit,” he explained.
By implication, Poddar’s decision means that he will not hesitate to sell to Deepak Fertilisers, which has acquired 24.46 per cent in MCF.
Gillette India tangle
Interests of Poddar, co-promoter of Gillette India, may be protected in a different way. The revision in Gillette’s proposal to SEBI for bringing down promoter holding in the company may not reduce his promoter status to a “public investor”.
The 68-year-old industrialist did not disclose what has been the modification in the proposal but said the SEBI nod was expected within a week.
“It has been amicably settled between Procter & Gamble and us and it also satisfies the market regulator,” he added.
Gillette had tried to circumvent the SEBI norm of 25 per cent minimum minority shareholding by placing Poddar’s 13 per cent in the minority category instead of being in the promoter segment. SEBI did not accept it. Gillette moved SAT, which eventually dismissed the appeal after hearing.
The revised proposal provides for reduction of combined promoters’ stake, including around 76 per cent of P&G. For failing to comply with the deadline, SEBI had restricted several rights of the entities including that on dividend.