A source associated closely with the developments surrounding the hostile bid by Mr Bajoria told The Financial Express that the basic contention of the company was that they were not informed by Mr Bajoria that he had crossed the 5 per cent limit, at which point he had to inform the company. "Therefore, the company could not inform the stock exchange since it was not informed by the acquirer of the shares itself", the source explained.

Besides, the company is also not worrying about Mr Bajoria's reported move to secure a board berth in Bombay Dyeing. "He has not written anything to the company, so were are not bothered about it. We have only read this in the papers." He said any moves to defend the company in whatever way would only arise once the exact dimensions of the case unfolded following Sebi's independent findings and the acquirer's response. "We're relaxing now", the source said.

Meanwhile, financial institutions are adopting a wait and watch policy on the faceoff even as the UTI officials expressed "surprise" at Mr Bajoria's statement in the media that he had bought a substantial chunk of Bombay Dyeing shares from UTI. A senior UTI official, on condition of anonymity, said the Trust was surprised that the jute baron had declared so openly that he had bought the shares from UTI. "These days, negotiated deals are not taking place. So how is he so sure that he has bought the shares from us?" a UTI official said. UTI chairman PS Subramanyam could not be reached for comment.

Institutional sources said the next course of action from the FIs' side could only take place once there were further developments. "There are many possibilities. One is Mr Bajoria makes an open offer, the other one can be Mr Wadia buying back the shares from him. Whatever the case, for us, price will have to be a critical factor. Nothing is decided yet on what we will do", the sources said.