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June 9, 2001
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Money > Business Headlines > Report June 9, 2001 |
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Modis open to revising offer priceBaburajan K The Modis are considering an upward revision of the offer price for Modi Rubber Ltd from the present Rs 81.50 a share. This comes a day after the financial institutions threatened a possible counter offer. The Modis will meet the institutions in the next few days to try and work a way out of the present crisis. "We would like to know more about the FIs' reservations, which made them consider a counter offer. Our immediate agenda is to complete the open offer and we are open to their demand for a revision in price," senior executives at HSBC, advisor to the Modis' offer, said. "We want a scenario which will be a win-win situation for all parties. However, we cannot comment on what the price revision would be at this stage," they said. The officials declined to comment on whether the offer size would be increased to accommodate the entire FI holding. Meanwhile, BK Modi told Business Standard from London, "We have left the matter to our merchant banker. We will go by their advice as they are the best judge on what a reasonable price is. "We have not given any lower or higher price levels to them to work with. And there is no truth to the statements that the company has been mismanaged. I cannot comment on what the FIs want to do," Modi added. At present, the Modis have around 26 per cent stake in Modi Rubber, while the FIs have 44 per cent and the public 30 per cent. On Thursday, FIs said they will not participate in the open offer by the promoters and could make a counter offer instead. The Modis have already secured government approval to transfer 21 per cent of their holding to overseas bodies, to share the cost of the open offer. The Modi Rubber scrip on Friday closed higher at Rs 65.30 on the Bombay Stock Exchange, up from yesterday's close of Rs 60, while the traded volume was 1,036 shares. FIs have been planning to sell their 44 per cent stake in Modi Rubber for almost four years now, but no buyer had been found. The Modis had earlier indicated they were not in a position to buy out the FIs, reiterating again their current offer for only 35 per cent.
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