Mangalore Chemicals shares spurt as Vijay Mallya resigns from board

Vijay Mallya has stepped down from the board of Mangalore Chemicals & Fertilizers after he lost control of his last bastion after losing control of Kingfisher Airlines and United Spirits.

Vijay Mallya Vijay Mallya, a director on the board of directors of Mangalore Chemicals & Fertilizers, resigned with immediate effect, the company said in a filing with the Bombay Stock Exchange (BSE).

Reacting to the news, the stock of the company rose 7.65 points (or 9.38 per cent) to close at Rs89.25 on the BSE.

The stock hit a high of Rs97.90 and a low of Rs83.10 during the day on Monday. The total trading turnover stood at Rs2.79 crore and the volume traded climbed to 2.98 lakh, compared with an average volume of 1.80 lakh shares in the past one quarter.

The market cap of Mangalore Chemicals & Fertilizers as of 1 December 2014 stood at Rs370.21 crore.

The stock had hit a record high of Rs104.65 on 8 October 2014 and a 52-week low of Rs52.30 on 16 December 2013.

Mallya lost the takeover battle for Mangalore Chemicals & Fertilizers (MCFL) to Deepak Fertilisers after the Zuari-United Breweries (UB) group combine failed to muster the necessary stake in MCF.

Zuari Group had, in April 2013, bought about 10 per cent stake in Mangalore Chemicals & Fertilizers in an open market deal. In November 2014, Deepak Fertilisers bought about 6 per cent stake in MCFL for Rs65.93 crore through an open offer, intensifying the takeover battle with Zuari Group.

The company purchased 70.44 lakh shares in MCFL, equivalent to 5.94 per cent, in the open offer that closed on 20 October 2014.

Deepak Fertilisers' stake in MCFL jumped to 31.25 per cent post offer.

Meanwhile, the Zuari-United Breweries (UB) group combine, which had offered a counter-bid of Rs81.60 per share, could acquire only 42,424 shares. The combine holds 38.44 per cent in Mangalore Chemicals & Fertilizers, as per the company's BSE filing.

The net profit of Mangalore Chemicals & Fertilizers rose 351.43 per cent to Rs42.57 crore despite a 1.99 per cent decline in net sales to Rs1,196.73 crore in Q2 of 2014-15 over Q2 of 2013-14.

Mangalore Chemicals and Fertilizers manufactures a range of products, including urea, di-ammonium phosphate, muriate of potash, granulated fertilizers, micronutrients, soil conditioners and specialty fertilizers.