Financial Daily from THE HINDU group of publications
Thursday, Apr 11, 2002
Corporate - Open Offers
Axles India to make open offer at Rs 7 per share
CHENNAI, April 10
AXLES India Ltd has informed the stock exchanges that it proposes to come out with an open offer for buying back the 9.04 per cent equity from the shareholders of the company.
The price per share has been fixed at Rs 7, and Indian Overseas Bank has been appointed as managers to the offer, the company has said in a note to the Bombay Stock Exchange.
Currently, Axle Holdings and Spicer (both of the US), and the TVS group companies, Sundaram Finance and Wheels India, hold 90.96 per cent of Axle India Ltd. This is the second time since 1999 that Axles India's shareholders are getting an opportunity to sell their shares in an open offer.
In December 1999, SPICER Heavy Axle Holdings Inc, a wholly-owned subsidiary of Dana Corporation, along with Wheels India Ltd and Sundaram Finance Ltd, made an open offer at Rs. 24.50 per share for 20 per cent in Axles India.
The offer was made consequent to Spicer Heavy Axle Holdings entering into a stock purchase agreement with Eaton Ltd to acquire 16,32,000 equity shares of Rs 10 each of Axles India (representing 40 per cent of the paid-up capital of the company) at Rs 24.50 per share.
It was through the issue that the promoters picked up 90 per cent of the company's equity.
Dana Corporation is a world leader in the axles industry and has a presence in India in axles business through Spicer India which manufactures axles for light vehicles.
In November 2000, Axles India came out with a rights issue for Rs 6.2 crore.
The money was used for redeeming high-cost debt and to part-finance a `drive heads' project.
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