Sebi clears Fame open offer

Sebi clears Fame open offer
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First Published: Wed, Dec 08 2010. 09 05 PM IST
Updated: Wed, Dec 08 2010. 09 05 PM IST
Mumbai: After an eight-month wait, Inox Leisure Ltd and Reliance MediaWorks Ltd have received the nod from the Indian capital market regulator for going ahead with their proposed open offers for acquiring control over multiplex-operator Fame India Ltd.
Inox, which runs its own chain of multiplexes across India, owns around 50.2% of the company as on 30 September.
It got into an agreement with the existing promoter of Fame, Shravan Shroff, to purchase a 43.28% stake from him and acquired the rest from the market.
Inox and R-MediaWorks were fighting a pitched takeover battle for controlling Fame, with R-MediaWorks crying foul and writing to Securities and Exchange Board of India, or Sebi, alleging collusion in the manner in which Inox procured the stake in the company from its existing promoter.
R-MediaWorks protested on the ground that the price offered by it for Shroff’s stake was much higher than that of Inox.
Inox had announced its open offer to the public on 6 February at an offer price of Rs51 per share, which valued the offer size at Rs41.98 crore, while R-MediaWorks’offer size was Rs180.14 crore, at a price of Rs83 per share.
Under the existing takeover regulations prescribed by Sebi, any entity owning more than 15% in a company has to make a mandatory open offer for at least 20% more. A committee constituted by Sebi has recommended certain changes to the takeover code. However, they are yet to be implemented.
aveek.d@livemint.com
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First Published: Wed, Dec 08 2010. 09 05 PM IST