Bhai Manjit Singh exits Bausch & Lomb
By Ananth Iyer | 22 May 1999
Bhai Manjit Singh has offloaded his entire stake of 12 per cent in Bausch & Lomb India Ltd to a clutch of institutional investors and European fund managers, including Morgan Stanley, for a consideration of Rs 30 crore.
The deal, involving 2.9 million shares, was brokered by Kotak Securities at Rs 130 per share, and sources say that Morgan Stanley picked up the major portion. The stakes were held by Montari Industries Ltd, a group company controlled by Bhai Manjit Singh.
Montari Industries was originally an equal partner in the joint venture with Bausch & Lomb of the US. The US group holds a 44 per cent stake in the joint venture''s Rs 24.48-crore equity.
Montari Industries'' precarious financial situation compelled it to begin off-loading shares at regular intervals. This company is now registered as a sick unit with the Board of Industrial and Financial Reconstruction.
The decision by Bausch & Lomb Inc., USA, to hive off its sunglasses business is perceived as a negative sign for the Indian subsidiary. Last year, the American parent announced its exit from the eyecare business and decided to shift its focus to visioncare, pharmaceuticals and surgical products. This resulted in tumbling of the Indian company''s share prices from Rs 161 to Rs 90 in a span of four weeks.
The company financed its expansion plans through a rights issue of equity shares in 1997. The company offered a ratio of four shares for every seven shares held at a premium of Rs 30 a share.