Sebi Asks Kannappan & Co To Justify Offer Price For Kadri Mills

Mumbai, January 22: | Updated: Jan 23 2003, 05:30am hrs
The Securities and Exchange Board of India (Sebi) asked G Kannappan & Associates to justify the offer price to shareholders of Kadri Mills Ltd and to take steps to open the offer within 45 days from the Sebi order dated January 18, 2003.

If Kannappan & Associates (acquirers) fails to comply with the directive, the escrow account would be forfeited and the proceeds be transferred to Investor Protection Fund, Sebi said in a release here on Wednesday. Further, the acquirers would not be allowed to deal in Kadri Mills scrip for one year commencing from the date of expiry of the 45 days period specified in the order. The Kadri Mills is listed on Madras Stock Exchange (MSE) and Coimbatore Stock Exchange (CSE) and Interconnected Stock Exchange of India Ltd (ICSE). The scrip is infrequently traded on CSE and MSE and while trades frequently on ICSE. Sebi had asked Indbank Merchant Banking Services Ltd, merchant banker to offer, to justify the offer price but it failed to do so.The acquirers collectively hold 74.88 per cent stake in the target company and G Kannappan entered into agreements with D Ramakrishnan and V Palaniswamy to acquire their 19,000 and 46,135 shares respectively at a negotiated price of Rs 5.45 per share.