In a bid to acquire full control of dry cell battery major Eveready Industries, the Burman family, the promoters of Dabur, has made an open offer to acquire an additional 26% share of the Khaitans-promoted company for Rs 604.76 crore.
“We have been monitoring the situation of the company and felt that now is an appropriate time to step in. The company needs direction and the brand has immense potential. We feel we will be able to add value and take this business to the next level,” Mohit Burman, vice-chairman, Dabur India, said.
The mandatory open offer under the takeover regulations was made even as the Burmans, already the single-largest shareholder in the Williamson Magor group flagship, proposed to purchase an additional 5.26% share of the battery maker for Rs 122.30 crore, taking their total shareholding to 25.11%.
The open offer price is Rs 320 per share.
At the end of the third quarter this fiscal, Khaitans owned 4.84% stake in the Kolkata-based company, while Burmans held 19.84%.
According to a stock exchange filing, Puran Associates, VIC Enterprises, MB Finmart, together with Gyan Enterprises and Chowdry Associates – all investment arms of the Burman family – have announced an open offer for acquisition of up to 1,88,98,688 fully paid-up equity shares of face value of Rs 5 each (offer shares) from the public shareholders of the battery major, representing 26% of the expanded voting share capital, at a price of Rs 320 per offer share (offer price), aggregating to a total consideration of up to Rs 604.76 crore payable in cash.
JM Financial has been appointed for managing the issue.
When contacted, Amritanshu Khaitan, MD, Eveready, declined to comment.
Eveready’s scrip closed 10.42% higher at Rs 376.30 on the BSE on Monday.
According to sources, the Burman family has sought three seats on the company’s board and will want to appoint a chairman after the open offer, as per the Sebi guidelines.
The Burman family had acquired around 8.48% additional equity stake in the battery major via open market operations in July 2020, taking its holding in the company to 19.84%.
The board of directors of Eveready Industries had in August last year appointed Suvamoy Saha, a non-executive director of the company, as joint managing director. Significantly, appointing a joint MD was in line with what the Burman family wanted.
The Khaitans’ shareholding in the company fell below 5% after banks and financial institutions continued to invoke and sell pledged shares for recovery of their dues from other group companies which are debt-ridden.
