The rise in the scrip price has been accompanied by huge volumes of around one lakh shares compared with a few hundred shares some time back. According to marketmen, Royal Packaging Industries Van Leer NV, Netherlands, is eyeing the company. After its acquisition of Paper Products Ltd, the Dutch major is understood to be on the look out for more investments in the Indian market.

According to sources, the Akar Group, which owns Sharp Industries, is said to be cash-strapped and on the look-out for a buyer. The replacement cost for Sharp's two units at Vasai and Aurangabad is estimated at around Rs 40 crore. Akar Laminators took over the company's management in 1996 after thwarting a bid by Paper Products. The company made a counter-bid of Rs 30per share as against Paper Products' offer of Rs 19 per share.

Meanwhile, Akar Laminators announced that it had entered into an MoU with the promoters and directors of Sharp Industries to acquire 288,5000 equity shares of the latter, representing 30 per cent of the paid-up capital.

Consequently, Paper Products withdrew its offer. Now with, Van Leer buying Paper Products, interest in taking over Sharp Industries has surfaced once again.

Van Leer is a global packaging company and has more than 140 operating firms in 43 countries. The group is said to be looking closely at the flexible packaging industry in India. At present, except for India Foils and Flex Industries, there are not too many packaging capacities available in the country.

While Flex Industries has an integrated polyester film unit, India Foils is not perceived to be geographically convenient to Van Leer as Paper Products' client base is more in the Western region. Besides, India Foils has already been taken over. According to analysts,the acquisition of Sharp Industries will add around Rs 50 crore to Paper Products' turnover.

Sharp Industries posted sales of Rs 50.94 crore and a net profit of Rs 3.1 crore for the year- ended June 1998. It has an equity capital stands at Rs 10.02 crore. On the bourses, the scrip had been languishing below par since 1996-end. The sudden upward movement in the scrip, especially at a time when the packaging industry is passing through troubled times, has raised a lot of eyebrows and it is being increasingly felt that a takeover could be on the cards.