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LIC picks up Harshad`s ACC stake for Rs 275 cr
Mumbai, Oct 11: The Life Insurance Corporation has picked up the late Harshad Mehta`s 10% stake in ACC for a total consideration of Rs 275 crore. LIC, which emerged as the sole bidder for the 1.62 crore shares put up for auction by the custodian dealing with the assets of `notified` persons involved in the 1992 securities scam, has paid Rs 170 per share for the stake, a 19.4% discount to the current market price.
Mumbai, Oct 11: The Life Insurance Corporation has picked up the late Harshad Mehta’s 10% stake in ACC for a total consideration of Rs 275 crore. LIC, which emerged as the sole bidder for the 1.62 crore shares put up for auction by the custodian dealing with the assets of ‘notified’ persons involved in the 1992 securities scam, has paid Rs 170 per share for the stake, a 19.4% discount to the current market price.
Notified persons are those suspected to be involved in the 1992 scam and are facing or have faced criminal charges.
The assets of the late Harshad Mehta — who was a notified person — are in the process of being sold off. At the special court dealing with the 1992 securities scam, LIC on Friday raised its offer from Rs 163 per share to Rs 170, even as the Harshad Mehta group argued that the price was very low. They wanted the stakes to be sold in small lots, which was not accepted by the special court. Mr Mehta’s family has decided to move the Supreme Court against the decision.
Although LIC was the single largest shareholder with shareholding of 16.2% as of end-June ’03, sources said that the insurer had sold heavily in the last quarter. As a result, even with the additional purchase its total shareholding would continue to be within 20% — the maximum limit permitted by the Insurance Regulatory and Development Authority.
The custodian had invited bids for the ACC shares on September 20 and the auction was open till October 8. Though rumours abound that several foreign cement majors may be interested in the “controlling stake”, LIC eventually emerged as the lone bidder.
Bureau Report
The assets of the late Harshad Mehta — who was a notified person — are in the process of being sold off. At the special court dealing with the 1992 securities scam, LIC on Friday raised its offer from Rs 163 per share to Rs 170, even as the Harshad Mehta group argued that the price was very low. They wanted the stakes to be sold in small lots, which was not accepted by the special court. Mr Mehta’s family has decided to move the Supreme Court against the decision.
Although LIC was the single largest shareholder with shareholding of 16.2% as of end-June ’03, sources said that the insurer had sold heavily in the last quarter. As a result, even with the additional purchase its total shareholding would continue to be within 20% — the maximum limit permitted by the Insurance Regulatory and Development Authority.
The custodian had invited bids for the ACC shares on September 20 and the auction was open till October 8. Though rumours abound that several foreign cement majors may be interested in the “controlling stake”, LIC eventually emerged as the lone bidder.
Bureau Report