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Tatas raise bid for biggest foreign buy
By agencies
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Tuesday, 07 June 2005, 19:30 IST
MUMBAI: Indian Companies scale up their Global Ambitions.
Tata Chemicals has increased its bid price for acquiring the Egyptian Fertilizers Company (EFC) to $519.2 million. If clinched, the deal will be the largest overseas acquisition by an Indian company.
According to a filing with the Cairo Stock Exchange, Tata Chemicals has offered to pay $352 per share to buy 1.475 million EFC shares, representing a 100 percent stake in the company.
Tata Chemicals offer is now around $9.2 million higher than the $510 million counter-bid made for EFC by Egypt Kuwait Holding (EK Holding), a financial services firm in Egypt.
Tata Chemicals had initially made an open offer to buy EFC at $305 per share and the total cost of acquisition worked out to $450 million.
The company will make use of its foreign currency convertible bond issue, internal accruals and bridge loans to fund the acquisition.
The acquisition will be a perfect fit for the company, as it will help it to leverage markets and gain global competitiveness. Tata Chemicals is looking at markets like Egypt and Bangladesh, where gas is available and there is huge local demand.
The sources said EK Holding, which had a 12 percent stake in the company, possibly had made a higher bid to raise the price level substantially.
The latest bid by Tata Chemical does not necessarily mean that the deal is clinched by the Tatas. There could be counter-bids, said the source. Any entity that wants to make a counter-bid has to do so within seven days.