As a result of the buyer freeze, volumes were also low on the National Stock Exchange and the stock closed at Rs 1845. The stock hit the upper end of the circuit soon after opening and remained frozen for the rest of the day. Colour Chem's scrip had dropped from a high of Rs 2,100 in mid-July to a low of Rs 1,775 in August last this year.

The Securities and Exchange Board of India had earlier rejected an application from Clariant International of Switzerland, seeking exemption from making a public offer under the TakeoverCode for acquisition of 50.1 per cent of the total equity capital of Colour Chem. Currently, Hoechst AG of Germany holds 50.1 per cent of the equity capital of Colour Chem. As a part of a global restructuring, Clariant International is to obtain Hoechst's speciality chemicals businesses worldwide.

Earlier there were expectations of a merger between Colour Chem and Clariant (India), which was ruled out by the companies. At that time, the company felt that the two entities are jointly identifying areas of synergies and opportunities to streamline operations, reduce costs and realise savings with a view to enhancing shareholder value in both companies. Colour-Chem is also in the process of transferring erstwhile parent company, Hoechst AG's 50.1 per cent holding to Clariant International. Colour Chem had registered a 58.73 per cent jump in net profit to Rs 38.27 crore for the year ended March 31, 1998. For the year, the company paid a total dividend of Rs 160 per shares against Rs 60 the year before. Turnoverwas up 11.2 per cent to Rs 372.86 crore and exports jumped 44.1 per cent to touch Rs 108 crore.

Colour Chem posted an eight per cent increase in net profit at Rs 4.96 crore for the first quarter of the current year. Colour Chem is set to hike its capacity for fine chemicals, pigments and additives by 20 per cent, which contributed to almost 70 per cent of the turnover in 1997-98.