Rayban, Seamec shareholders to benefit

Mumbai: Shareholders of Rayban and South-East Asia Marine Engineering and Construction (Seamec) are likely to get a major windfall, as their foreign promoters are expected to make open offers at prices substantially higher to the ruling market price.

While Luxxottica of Italy, Raybans parent, is expected to make an offer at around Rs 96 per share against the current market price of Rs 55 per share, the Technip group of France, Seamecs parent, is to make an offer at Rs 200 per share against the ruling market price of Rs 80.

The Securities and Exchange Board of India (Sebi), the Indian market regulator, last week pulled up both Luxxottica and the Technip group for violating the Sebi takeover code by not making an open offer following the acquisition of shares in domestic companies. It had issued show-cause notices to Luxxottica for the takeover code violation.

Under the Sebi takeover code, acquisition of over 15 per cent in a domestic company triggers the takeover code and the acquirer will have to make an open offer for buying a minimum 20 per cent from other shareholders.

The notices have been issued to these companies under regulation 44 and 45 of the Sebi takeover code and section 11, 11B and 24 of the Sebi Act, asking why action should not be taken for violating the code. Sebi has given the two companies time till 5 March 2002 to reply.

Sebi says Luxxottica violated the code by not making an open offer by buying the minimum 20 per cent from the shareholders of Rayban Sun Optics India after it purchased Raybans global parent. Rayban was formerly called Bausch and Lomb India. In April 1999, the Luxxottica group acquired the sunglasses business of B&L USA and through this, indirectly gained control of the 44 per cent in B&L India.

Sebi has said the company will have to make an offer to acquire a minimum 20 per cent from public shareholders of the company. It said the reference date for calculating the price will be 28 April 1999, which is the six-month average price prior to the reference date. The open offer works out approximately to Rs 96.35 per share.

Sebi also served a notice to the Technip group for violating the takeover code following its acquisition of a controlling stake in Seamec. The French company had acquired 29.7 per cent in Coflexip Stena Offshore (CSO) from Stena International sometime in April 2000. CSO was the parent company of Seamec.

Following the acquisition of the stake, Technip had made an open offer in July 2001 to minority shareholders of CSO and secured a 98.4 per cent in CSO in October 2001. With this, Technip also got an indirect control of CSOs 58.2 per cent stake in subsidiary Seamec, formerly Peerless Shipping. Sebi has said the reference date for calculating the price is 12 April 2000, the date when it acquired the stake from Stena International. The offer price is estimated to be over Rs 200.