After a four-month delay, Holcim on Wednesday received the go-ahead from Sebi to make its open offer to minority shareholders of Ambuja Cement Eastern (ACEL), who have a five per cent shareholding in the company.
The Swiss cement giant, through majority-owned Ambuja Cement India (ACIL), recently completed its open offer for ACC, in which it now owns a 34.7 per cent stake.
Sebi has said that since ACEL - which was acquired by Gujarat Ambuja Cements in the mid1990s - had given an undertaking to the Board for Industrial and Financial Reconstruction (BIFR) that the firm would remain listed, ACIL will have to make its open offer pursuant to regulations 10 and 12 of the takeover regulations.
"In view of the BIFR order, the offer which was otherwise attracted by regulation 11 (2A) and was to be made in the delisting guidelines, cannot be made under the delisting guidelines. The offer therefore is allowed to be made under regulations 10 and 12," Sebi has said in its letter to DSP Merrill Lynch, which has been the advisor to Holcim.
This means that ACEL has to continue as a listed company, even if ACIL ends up with a 100% stake, post the open offer. It’s not clear, however, if in such a scenario ACIL will need to scale down its shareholding in ACEL over a period of time, to remain a listed entity.
When contacted, Gujarat Ambuja Cements’ executive director, Anil Singhvi, said: "We received the Sebi clearance today. We will now finalise the date on which the offer will open." ACIL, the vehicle through which Holcim made the open offers for ACC and ACEL, is 67%-owned by the Swiss firm, while the rest 33% is owned by Gujarat Ambuja Cements, the country’s fourth largest cement producer.