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December 20, 2007 |
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IFCI LTD: Board Rejects Sterlite-Morgan Stanley Consortium Offer IFCI Ltd's board of directors, at its recent meeting, rejected the financial proposal submitted consortium of Sterlite Industries and Morgan Stanley and Co. for the 26% stake in the company, a filing with the Bombay Stock Exchange revealed. According to the company, the consortium's offer was conditional and the board unanimously decided that the conditional offer is not acceptable. The rejection came after news that the Sterlite-led consortium has emerged as the front-runner to acquire 26% stake. The Economic Times, citing unnamed sources close to the development, previously reported that the consortium offered a INR107-per- share minimum price at which institutional shareholders will convert their debt into equity. According to ET's sources, the Sterlite consortium was the only bidder to be invited on Monday evening for discussions since the bids made by the other two consortia have many conditions attached. The Troubled Company Reporter-Asia Pacific reported on Dec. 5, 2007, that four bidders for the stake, including the Sterlite- Morgan Stanley consortium, have carried out due diligence. The three other firms were: -- WL Ross, US Capital Partners VI Fund, Standard Chartered Bank and HDFC. -- Cargill Financial Services Corporation and Texas Pacific Group -- Shinsei Bank Ltd, PNB and JC Flowers & Co. From four, the number of bidders later narrowed down to three after the consortium led by WL Ross opted out without submitting a financial bid, ET relates. IFCI Limited -- http://www.ifciltd.com/ -- is established to cater the long-term finance needs of the industrial sector. The principal activities of IFCI include project finance, financial services, non-project specific assistance and corporate advisory services. Project finance involves providing credit and other facilities to green-field industrial projects (including infrastructure projects), as well as to brown-field projects. Financial services covers a range of activities wherein assistance is provided to existing concerns through various schemes for the acquisition of assets, as part of their expansion, diversification and modernization programs. Non-project specific assistance is provided in the form of corporate/short-term loans, working capital, bills discounting, etc to meet expenditure, which is not specifically related to any particular project. Its investment portfolio includes equity shares, preference shares, security receipts and government securities. * * * As reported in the Troubled Company Reporter-Asia Pacific on April 3, 2007, India's Credit Analysis & Research Ltd. retained a CARE D rating to IFCI's Long & Medium Term Debt aggregating INR91.36 crore. The amount represents the outstanding non- restructured amount under the Bonds series, which have been rated by CARE. Fitch Ratings, on June 29, 2006, affirmed IFCI's support rating at '4'. The outlook on the rating is stable. |
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