In a letter to the stock exchanges, the company disclosed that financiers sold 1.21 crore shares to recover their money following stock slide. The promoters had pledged these shares for various financial needs. As a result of the sale which was spread over a week, promoter stake in Bhushan Steel has come down from 69.83 per cent to 64.47 per cent.
When the value of the pledged stock dives steeply, financiers normally sell the stake to protect their money. Further selling in Bhushan Steel is likely as the stock has been hitting lower circuit almost every day, said a market source.
On Tuesday, Bhushan Steel shares hit a lower circuit limit of 5 per cent at Rs 144.90 on the BSE, with the stock extending its recent steep slide. The stock had underperformed the market over the past one month, falling 65 per cent compared with three per cent rise in the Sensex.
Earlier this month, the Central Bureau of Investigation (CBI) arrested Bhushan Steels vice chairman and Managing Director Neeraj Singal in the Rs 50 lakh bribery scandal involving Syndicate Bank chairman S K Jain, who is also in custody.
Lenders of Bhushan Steel have taken charge of the company, and asked for three director posts on the companys board. It has also sought a forensic audit of the companys books and a concurrent one of its cash flows. The first audit will find out whether the company hid something or has indulged in any malpractice, while the second will simply keep track of its cash. A consortium of lenders has an exposure of around Rs 40,000 crore to Bhushan Steel.