New Delhi, Mar 20: Takeover candidates fared poorly on the bourses on Friday. Indian Aluminium, Raasi Cements and Saurashtra Cements which have been the target of hostile bids seem to have run out of steam on the markets.A day after the open bid for Saurashtra Cements was made public by Autoriders' Finance, the scrip started looking down. Though the market had partly discounted the open offer price of Rs 75, the scrip started moving down. Unlike in the case of Indian Aluminium, where the scrip had breached the Sterlite offer price of Rs 90, Saurashtra Cement continues to languish well below the open offer of Rs 75. The scrip peaked at Rs 68 on Wednesday after it started rising from Rs 50. In the last two trading sessions, the scrip has lost close to Rs 10 and closed at Rs 59 on Friday.
The other takeover candidate, Raasi Cement too could not scale the takeover price of Rs 300 and had peaked at Rs 263. Since then, the scrip has lost considerable ground and closed at Rs 192 on Friday at the BSE.
Afterthe initial euphoria, the market now seems to be studying cautiously these takeover attempts. For one, the takeover threats have seemed to hit a road block with Alcan talking tough and making a counter bid, the Rajus of Raasi resorting to parochial rhetoric and the Mehtas at Saurashtra gearing to thwart any takeover bid.
In the case of Raasi, the market might have realised that Rs 300 might be too high as there is uncertainty whether Shree Vishnu Cements will also fall into the bag. The promoters are believed to have transferred their stake in Shri Vishnu.
A similar assessment could also see investors loosing interest in Saurashtra Cement. This is because, Gujarat Sidhee Cement, a subsidiary of Saurashtra Cement may not go into the hands of the bidders for the latter. Saurashtra reportedly holds seven per cent of Gujarat Sidhee, with the rest held by other promoters.
Brokers also point out that Saurashtra Cement might come out with a counter offer providing better opportunity for investors. This,however, depends on the range of the counter offer. The same applies in the case of Indal, where the gap between offer and counter offer may not be enough to generate a buying interest.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
