The Indian ICICI Bank has sold its entire 8.5 per cent stake in the SK Birla promoted Mysore Cements (MCL) to SBI Mutual Fund and Templeton Mutual Fund for a consideration of Rs 35.5 crore. ICICI Bank has sold 74 lakh shares of MCL at Rs 48 per share. ICICI Bank had bought 8.5 per cent in MCL in early ’05 through the preferential allotment route. The Mysore Cement counter has been witnessing action for the past one month on the speculation that the SK Birla group planning to exit from MCL.
Dealers said the interest in the stock was mainly because of speculation that the company would be acquired either by the AV Birla group or by foreign cement firms like Holcim or Italcmenti. However, the company management has been denying the rumour. On Thursday, the stock of Mysore Cement gained 4.85 per cent to close at a 52-week high of 49.75 on the BSE. Currently, the SK Birla group holds a 25.13 per cent stake in MCL. The group’s textile firm Birla VXL holds 4.75 per cent, while other SK Birla group companies hold the remaining 21 per cent. The dealers also said negotiation for the sale has been going on for some time.
Mysore Cement has a capacity of 2Mta and sells cement under the brand name, Diamond. The Bangalore-based company had also diversified into sponge iron making. It manufactures ordinary and pozzolona varieties of portland cement. The company has plants in Karnataka and Madhya Pradesh and a grinding unit in Uttar Pradesh (abstracted from Economic Times, India)