MUMBAI, January 30: The promoters of United Phosphorous Ltd (UPL), the Shroff family, have been issued only nine lakh shares through warrant conversion allotted out of the earlier stipulated 36 lakh shares. The balance warrants, whichrepresent 27 lakh shares, have lapsed.In the process, the Shroffs had to shell out just Rs 7.2 crore, which otherwise would have worked out to about Rs 29 crore. Sources said since the Shroffs had to fund other projects being promoted by the group over the last two years, they could subscribe to only a part of their allotment.
The company, in a board meeting on Friday, issued these shares to the promoters against warrants. Subsequently, the promoters' stake in the company will go up to 38 per cent from the existing 35 per cent. The company's equity capital after the conversion of warrants has increased to Rs 24.57 crore. An extraordinary general meeting (EGM) will be convened in a month, sources said. United Phosphorous had decided to issue coupons to the promoters in 1994.
This was to up the promoters' stake which had diluted by 7-8 per cent after the company launched a rights issue in 1993 and a global depository receipts issue in 1994.
The company is one of the leading players in the agrochemicalssector with a turnover of over Rs 500 crore. It manufactures pesticides like chlorpyriphos and cypermethrin.
United Phosphorous is a market leader in technical grades of pesticides and the organo-phosphate range of pesticides.
It mainly benefits from its subsidiaries and marketing wings abroad. The company has offices in around 12 countries, the recent acquisition being a Danish firm called Agrodan where it acquired a 60 per cent stake. The company's net profit dropped 43 per cent to Rs 27.58 crore as on March 31, 1997, against Rs 48.30 crore. Sales during this period increased to Rs 516 crore from Rs 419 crore in the previous year.
Analysts say a slump in the market coupled with a delayed monsoon put the company on the rough path. In the first six months of 1997-98, sales dropped by 12 per cent to Rs 257 crore.
The company's share price has been on the downslide for sometime and the scrip is at present quoted at around Rs 100 per share on the Bombay Stock Exchange.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
