UB Group makes open offer for 20% of Air Deccan
07 Jun 2007
The open offer, in line with Sebi norms, follows the 26% preferential issue made by Deccan Aviation to UB Holdings.
The subsidiary, Kingfisher Radio, was set up in 1999 to promote and sell media such as satellite, video, television and radio besides deploying funds by way of investments in assets, properties, securities etc.
Meanwhile, the 20 per cent public holding, which the UB Group is now bidding for, would work out to a total of 27,094,024 shares. At a price of Rs155 per share, the UB Group will have to shell out around Rs420 crore, if Air Deccan's shareholders should accept the offer. The offer is due to open on July 25, and close on August 13.
On May 31, the board of Deccan Aviation approved a preferential issue to the UB group of up to 3.52 crore shares, at a price of Rs155 each, constituting 26 per cent of its post-issue capital, amounting to a total of Rs550 crore. The UB Group has made an upfront payment of Rs150 crore under the agreement, and will now have to pay the balance Rs396 crore before June 29 this year.
Edelweiss Capital is managing the offer.
After the open offer, the non-promoter shareholding in Deccan Aviation will be about 57.63 per cent of the total paid-up capital of the company.
Financing tied up…
Meanwhile, UB Group officials have said that financing for the deal is more or less tied up with their receiving "binding term sheets" from three financial institutions (FIs) (Indian and overseas), including Deutsche Bank, in response to their need for Rs400 crore to fund the acquisition of Air Deccan.
The officials said that they would study the offers before settling on one of them.
