Fitch Puts GACL NCDs On Rating Watch

Mumbai, October 28: | Updated: Oct 29 2002, 05:30am hrs
Fitch Ratings India has put Gujarat Ambuja Cements (GACL) Rs 450 crore AAA (ind) rated non-convertible debentures on rating watch with evolving implications.

This follows the ruling of the Securities Appellate Tribunal (SAT) ordering the Securities and Exchange Board of India (Sebi) to ascertain the issue of control when GACL acquired the 14.45 per cent stake in ACC from the Tatas.

The AAA (ind) rating indicates highest credit quality and lowest expectation of credit risk. Fitch is monitoring the developments and is in discussion with the company regarding the implications and will make a detailed announcement in due course.

The SAT order was in response to a petition filed by a group of ACC shareholders for the violation of the takeover code. Sebi had earlier opined that GACL does not hold a controlling stake in ACC and the reversal of this decision could result in GACL being required to make an open offer as per the Sebi takeover code. The market regulator has been directed by SAT to investigate whether GACLs acquisition of the stake has triggered Regulation 12 of the takeover code. According to Regulation 12, no acquirer shall acquire control over a company without making an open offer to public shareholders of the target company. On The Stock Exchange, Mumbai (BSE), the stock of cement major slipped 3.5 per cent to close at Rs 156.20, as against its previous close at Rs 161.95. A total number of 40,747 shares of GACL were traded on the counter on Monday.