The Lalit Mohan Thapar group is exploring the possibility of raising its stake in Ballarpur Industries Ltd to 51 per cent from the existing 42 per cent by buying out the 9 per cent held by the Unit Trust of India.
According to sources close to Thapar, the group has already sent feelers to this effect to UTI through merchant bankers, though full-fledged negotiations between the two parties are yet to take place. Bilt is the country's largest paper company and the flagship of the LM Thapar group.
The company's promoters have been raising their stake ever since the Kolkata-based Arun Bajoria acquired a stake of slightly over 5 per cent in Bilt two years ago and demanded a board seat.
At that time, the promoter's stake in the company was around 30 per cent. Since then, Bajoria has liquidated his holding in the company.
A few months back, the group's stake went up by 7 per cent when the West Asia-based Al Murjan group, a 14 per cent shareholder in Bilt, renunciated its rights in a 1:1 rights issue by the company in favour of the Indian promoter.
Sources also disclosed that the Thapars have used the creeping acquisition route to acquire another 5 per cent in the company during the current fiscal.
"This year's limit of 5 per cent has been reached. Further acquisition under the creeping route will have to wait till the next financial year," the sources added.
It is understood that the group had also evaluated the possibility of buying out Al Murjan's 7 per cent stake in Bilt and then use the creeping acquisition route to take its stake to 51 per cent in the company. However, it has now decided to buy out UTI from Bilt.
Recently, Bilt Graphic Papers Ltd (earlier Sinar Mas Pulp & Paper), which was a closely held company of the L M Thapar group, was merged into Bilt. But the merger did not alter the promoter holding in Bilt in any significant way.
