Bhasin's DSIL open offer hits Sebi hurdle

Stockbroker Harish Bhasin has got Rs 22 crore (Rs 220 million) stuck in the bid to take over DCM Shriram Industries, the Delhi-based sugar company. He invested the money to raise his stake in DSIL from 12.87 per cent to 25.05 per cent over the last five-and-a-half months.

He bought DSIL shares from the open market. However, his open offer to buy 22.88 per cent stake has not taken off, pending an approval from the Securities and Exchange Board of India.

The public announcement to the offer was made on November 19 last year and the offer was scheduled to open on January 3. The price of the open offer was Rs 70 a share initially, but was later revised to Rs 120. However, since HB Stockholdings, Bhasin's company, did some market purchase at a price of Rs 127, the open offer price automatically stands revised to Rs 127.

Sebi did not respond to an emailed query sent by Business Standard a week ago. "We have increased our stake to over 25 per cent and would continue to purchase more shares as and when there is an opportunity," said an official at HB Stockholdings.

We are following the open offer issue with Sebi through our merchant bankers. The company is committed to the open offer and would purchase whatever shares come to us," said an official at HB Stockholdings.

Meanwhile, the promoters of DSIL, led by Tilak Dhar, have raised their stake in the company to 40.7 per cent through an issue of warrants.

Last November, HB Stockholdings had filed a petition with the Company Law Board against the warrant issue. The warrant issue would affect the interest of minority shareholders, HB Stockholdings had claimed. The case is still with the board and the next date of hearing is July 22.

DSIL was established in 1990, following the three-way split of DCM. Sugar is DSIL's main business - almost 50 per cent of its turnover comes from sugar. DSIL's sugar plant, located in Daurala (Meerut) in Uttar Pradesh, has a 11,000 tonnes crushed daily (tcd) capacity. It also makes pharmaceutical-grade sugar and Indian-made foreign liquor.