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C-MAC says to seek advice on public offer

C-MAC Centum India Ltd said on Thursday it would consult lawyers on whether its foreign owners need to make an open offer to shareholders following its parent's acquisition by Solectron Corp.

US-based Solectron, the world's largest electronics contract manufacturer, last week agreed to buy Canada's C-CMAC Industries Inc for $2.7 billion in stock in order to move into the market for automotive circuitry.

K S Desikan, financial controller of C-MAC's Indian unit which makes circuits for telecom equipment, said that the Canadian parent held a 50.6 per cent stake in the Indian company founded in 1994.

"We are trying to talk to our lawyers. The Sebi (Securities and Exchange Board of India) takeover code may apply," he said.

Indian takeover code makes it mandatory for anyone buying a 15 per cent or more stake in a company, to make an open offer to buy at least 20 per cent from public shareholders. A change in ownership due to the acquisition of a foreign parent also triggers the open offer requirement.

Desikan said the Indian founders of the Bangalore-based company held about 24 per cent and financial institutions about 2 per cent of the firm.

C-MAC Centum's shares were up nearly eight percent at Rs 19.05 on the Bombay Stock Exchange in just one trade of 400 shares.

Desikan said the company's sales grew 20 per cent in 2000-01 to Rs 420 million from about Rs 350 million in the previous year.

"We hope it (acquisition) will bring in a lot of synergies," Desikan said.

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