Tuesday, Sep 16, 2003
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The SEBI, in an affidavit, said its August 1 order asking Mr. Mallya and the Chhabrias to make open offers to divest their stakes in excess of 21.38 per cent and 10 per cent shares respectively in Herbertsons, should be upheld by the apex Court. Appearing before a Bench comprising Chief Justice V. N. Khare and Justice S. B. Sinha, Solicitor General, Kirit Raval, said the SEBI was not concerned with the question as to who held the reins of the target company and was interested only in securing the interest of the investors in securities. Thereafter, the Bench adjourned the matter for further hearing to October 17 and continued its order of September 8 by which it had said that competitive bidding for Herbertsons' shares would go on as planned but the 19.1 per cent held by the Chhabrias would be subject to its further orders. The Securities Appellate Tribunal (SAT) had reversed the February order of SEBI and indicted it for passing an order in the case without an adequate explanation. — PTI Our Mumbai Correspondent writes: The Herbertsons issue was being unnecessarily blown out of proportion, according to Vijay Mallya, Chairman of the UB group. "People are having a field day observing the much touted battle for control of Herbertsons. At the end of it all, there are laws of the land and there is financial power, both to ensure that shareholders are the ultimate beneficiaries," Mr. Mallya said in a release. Further, he added, "I have seen Mr. Kishore Chabbria's revised offer. It is in a complicated manner to say the least. Imputed or assumed net value to shareholders does not augur for transparency. Our offer is crystal clear with a clearly stated price of Rs. 200 per share for 42.5 per cent of the equity of Herbertsons. If Mr. Kishore feels that his offer was better, let him announce a price of Rs. 210 per share and pay the interest separately in addition". Mr. Mallya said it remained unclear as to the status of Mr. Kishore's 19.71 per cent shareholding, which was acquired in contravention of SEBI regulations. "This illegality has been confirmed by the Bombay High Court, SEBI and the SAT. Moreover, now SEBI in its affidavit filed in the Supreme Court has reiterated that the illegally acquired 19.71 per cent shares should be ordered to be disinvested by Mr. Kishore Chabbria and in fact, SEBI has stated that it is filing appeal in the Supreme Court against the SAT order for this purpose. Hopefully, the Supreme Court will take a view on this at the next hearing, scheduled for October 17". Small shareholders, who did not get any benefit in 1995 specifically provided for under the SEBI Takeover Code, must share the true value of their holdings as they were denied this opportunity. Finally, Mr. Mallya added, "Under the SEBI guidelines, we have ample time to increase UB's offer. We will take necessary steps, to bring this issue to a decisive end".
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