LIC to tender 5% stake in Holcim open offer for ACC

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Mumbai, April 6: The Life Insurance Corporation (LIC) of India, the largest institutional shareholder in the Associated Cement Companies (ACC) Ltd has decided to tender a 5% stake in the open offer of Holcim Ltd. LIC had a 15.72% stake in ACC as on December 31, 2004. The offer price for ACC is Rs 370 per share. However, it is yet to decide on the issue of participating in another open offer — the one for Crisil Ltd made by global rating major Standard & Poor’s (S&P). The S&P’s offer opened on Wednesday for subscription. LIC holds 2.81 crore shares in ACC’s equity of 17.84 crore shares. LIC’s decision to tender 5% stake in ACC comes to 14.03 lakh shares and at the rate of Rs 370 per share, LIC will rake in Rs 51.90 crore. The Holcim offer for ACC shareholders opened on March 24 and will close on April 11.

Confirming the move, a top LIC official told FE, “our investment committee has met over the issue and decided to offer 5%.” According to LIC sources, the institution had acquired stake in ACC at a much lower price and would get a better return at Rs 370. “The rest of our holding in ACC will be for long-term investment,” said the LIC official.

The ACC stock gained 0.57% on The Stock Exchange, Mumbai (BSE) to close at Rs 363.60, where 2.16 lakh shares changed hands on Wednesday. However, the life insurance major is yet to take a decision on its possible participation in S&P’s open offer for Crisil. The global rating major has made an offer to acquire Crisil shares at Rs 680 per share.

The other major shareholders of Crisil are ICICI Bank (with a stake of around 11%), SUUTI (over 8%) and Rakesh Jhunjhunwala (over 13%). Like LIC, these shareholders have also not taken a stand yet on the issue of participating in the S&P offer.