No takers for scam-tainted ACC shares of Harshad Mehta

Mumbai: There are presently no bidders for the scam-tainted ACC shares of Harshad Mehta as the two possible buyers, financial institutions and Gujarat Ambuja Cements Ltd (GACL), have decided not to bid for the same.

The shares, which represent around 12 per cent equity capital of ACC, have been put for auction and the bids are likely to open soon.

GACL, with a 14.45 per cent stake in ACC, has already said that it will not buy the Mehta shares because it will trigger the Securities and Exchange Board of India takeover code regulations.

GACL could be in trouble as the group's holding in the company will then breach the threshold of 15 per cent due to the reduction in the capital base. Recently, the promoters of Apollo Tyres had a similar experience.

Life Insurance Corporation of India, which has been acquiring Mehta's shares from auctions, has also decided against picking up the ACC block due to its over exposure in the cement scrips.

"LIC has enough cement stocks in the portfolio with holdings in Larsen & Toubro and ACC. Each time the prices of the cement scrips go down the corporation gets affected," says a senior LIC official. LIC has an 18.6 per cent stake in L&T and a 15.69 per cent stake in ACC. Foreign financial institutions together control a 26 per cent stake in ACC.