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Efforts to consolidate shares in TMB

By K. T. Jagannathan

CHENNAI, APRIL 3. Having regained control of the Tuticorin-based Tamilnad Mercantile Bank (TMB), B. Ramachandra Adityan-spearheaded Nadar Mahajana Bank Share Investors' Forum is quietly working on a consolidation course to insulate the bank against any takeover threat in future. The consolidation move will essentially aim at putting in place some sort of a mechanism that will ensure that the majority holding lies with a select few within the community with appropriate riders on selling their holdings.

According to Mr. Ramachandra Adityan, the Forum would explore the option of consolidating a part of the 33 per cent shares that had been bought recently in the names of seven individuals within the community from the Sterling group.

The Forum, it may be recalled, had already paid the Sterling group Rs. 81 crores to acquire 34 per cent stake. Much of the shares had since been transferred in the name of the individuals who had paid to retrieve the bank to the community fold. If Mr. Adityan were to go by, the Forum would scout for foreign institutional investors to park a part the 33 per cent now bought in the name of these seven individuals. The Forum even earlier had contemplated induction of foreign institutional investors by parking 17 per cent shares with them. With the latest turn of events, however, inquiries have reportedly started pouring in from bigwigs within the community.

"We are now exploring the possibility of consolidating over 15 per cent of this 33 per cent in a few hands," sources said. Given the encouraging enquiries from within, the Forum would now have to take a call on whether the bank should go in for FII investment at all and, if so, at what level.

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