Saroj Poddar, Vijay Mallya to meet next week on Mangalore Chemicals bid

Written by Mithun Dasgupta | Kolkata | Updated: May 4 2014, 04:48am hrs
VijayThey point out that the plants are similar and located within close proximity to each other
Adventz Group chairman Saroj Poddar said on Saturday he would decide on launching a counter offer for Vijay Mallya-controlled Mangalore Chemicals & Fertilizers (MCF) after meeting the UB Group chairman sometime in the middle of next week. We will be meeting either on Wednesday or Thursday, Poddar told FE

Upping the ante, Sailesh Mehta-run Deepak Fertilisers and Petrochemicals had on Friday raised its offer price from Rs 61.75 to Rs 63 per share for a 26% stake in MCF.

We need to decide whether we will sell or make a counter bid, Poddar said, declining to comment further.

Analysts believe there is a chance Poddar might offer a higher price given that the synergies between the MCF unit and that of Zuari are far higher than those between Deepak Fertiliser and MCF. They point out that the plants are similar and located within close proximity to each other.

At present, Poddar holds 16.43% stake in Mangalore Chemicals through Zuari Fertilisers and Chemicals, while liquor baron Mallyas UB Group, which is facing financial woes, has about 22% stake in MCF. Deepak Fertilizers, which is the highest shareholder of the Bangalore-based firm, had recently increased its stake to over 25%.

Asked whether matters like his Zuari acquiring Mallyas stake in MCF could come up in the discussions, Poddar said, He (Mallya) is an independent businessman. So I cannot comment on whether he would be selling any stake to me. He reportedly has a first-right-of-refusal treaty in place on Mallyas shareholding in MCF.

In July last year, Poddar had said he was keen to acquire UB Groups stake in MCF through a friendly deal. But Mallya had said he would retain control in the fertiliser company, stating he was ready to buy stakes from Zuari Chemicals and Deepak Fertilisers.

Poddar had then said he was keen to sell his stake in MCF to the highest bidder by February this year.