The Securities & Exchange Board of India (SEBI) is probing the possibility of an open-market acquisition of additional 11 per cent shares by Jimmy J Gazdar, a 32 per cent shareholder in Cochin Malabar Estates Industries Ltd, to find out whether there has been a violation of the takeover regulations laid down by the securities watchdog.
Understanding Cochin Malabar Estates Industries Ltd
The probe has come in the wake of information received by SEBI officials. It was about the open-market negotiated deal entered into by Gazdar without informing SEBI. SEBI officials yesterday confirmed having received a letter from interested parties. It informed them about the open-market negotiated deal entered into by Gazdar, chairman and managing director, of the company.
The Calcutta-based B G Bangur combine holds another 15 per cent in the company. “We have asked the company officials and the other promoters. It furnished details before deciding on the issue”, said a SEBI official. He, however, refused to reveal further details on the subject. Gazdar was not available for his comments at his residence in Panaji.
Overview
Cochin Malabar Estates Industries Ltd, incorporated in 1930 by the amalgamation of Eddivanna Rubber & Tea Co, Kinalur Rubber Co Ltd, and Kuttiadi Rubber Co Ltd, has an equity capital of Rs 1.77 crore.
It is believed that the controlling interest of the Cochin Malabar Estates & Industries is held by two distinct groups, one represented by Jimmy J Gazdar who holds 32 per cent in the company, and another by the B G Bangur combine.
Sources close to the Bangurs said one of the Bangur faction (not the B G Bangur combine) is reported to have quietly acquired nearly 10-11 per cent of the company’s shares from open market over a period of time. Subsequently, the Bangur faction, reportedly under a severe financial crunch. It made an offer to the major shareholder — J J Gazdar. He paid for entire 11 per cent stake at a negotiated price of Rs 200 per share. Gazdar acquired the additional shares at Rs 200 per share from the Bangur son.
Sources said proceeds from the sale of Cochin Malabar Estates Industries Ltd shares will enable the Bangur faction to partly tide over the severe financial crime crunch.Besides, Gazdar also appears to have picked up another five per cent stake from a domestic financial institution.
