Indian conglomerate Essar's plans of a cheap buy-back of its British unit have been criticised here as a blow to the reputation of the London stock market.
Essar Energy, the power company floated in the UK back in 2010, employs 1,500 people at the Stanlow oil refinery in Cheshire.
According to the 'Sunday Times', its owners - the Ruia brothers Shashi and Ravi Ė are giving the final touch to a takeover bid with a deal to be pitched at no more than 75 pence a share, a fraction of the 420 pence paid by investors who bought in four years ago.
Describing the move as a "disastrous foreign float" that will leave investors badly burnt, the newspaper said the company is expected to create an independent committee led by Philip Aiken, a senior independent director, to assess any offer.
It added: "The family will need to raise about 500 million pounds to pay for the remaining stock and to buy out a convertible bond.
"It is unclear whether the offer would be made in the form of a scheme of arrangement, which would require 75 per cent approval from non-family shareholders, or a straightforward takeover bid requiring approval from only half of the shareholders.
"The Ruia family will be barred from voting its 78 per cent stake, but investors are still likely to sell out."
The move is also being seen as indicative of the high-risk attached to stock from the developing world.
Essar's share price hit a high of 589p in 2010 but since then has slumped nearly 90 per cent.
The company dropped out of the FTSE 100 in 2012 as it battled with delays to plant openings and Indian regulators' demands on mines.
"Slower-than-expected growth in the Indian economy further hindered the company, and trading in the stock fell to a trickle as institutions shunned it," the 'Sunday Times' says in its analysis.
Bankers at VTB and Barclays were this weekend working to hammer out the details of a bid.
It is thought that JP Morgan is advising the company. Essar has declined to officially comment on the impending plans, the report said.