INDIA BUSINESS WORLD - OCTOBER 21st - NOVEMBER 15th
- 2007
SHISHIR BAJAJ SELLS 1% SHAREHOLDING IN BAJAJ AUTO
Even as the Bajaj brothers slug it out in the courts, the Shishir Bajaj faction has quietly sold 1% shareholding in Bajaj Auto for over Rs 200 crore. This transaction took place around the same time last month that the Shishir Bajaj group increased its stake in Bajaj Hindusthan to 4.75%. It is learnt that Bajaj Auto stake sale proceeds were used to buy the shares of sugar company.
According to sources in the auto industry, the Shishir Bajaj faction held around 1.4-2% in Bajaj Auto before the stake sale.
In the third week of September, the Shishir Bajaj faction increased its shareholding in Bajaj Hindusthan by picking up shares from the open market. The entire transaction reportedly cost around Rs 123.48 crore.
The holding of the entire Bajaj family (including both factions) in Bajaj Hindusthan, as of end-September, according to the BSE website is 41%. The holding of the entire Bajaj family in Bajaj Auto is 30%. While the family members do hold small individual stakes, the bulk of the family shareholding is through holding companies.
Although the family feud is currently before the Company Law Board, both sides maintain that additional stake acquisition of the Shishir Bajaj group in Bajaj Hindusthan is of no strategic importance. The stake hike cannot go beyond 5% without triggering the takeover code.
The Shishir Bajaj group had earlier indicated that it simply made economic sense because the sugar stocks were down even though the Sensex was shooting up. "The majority of the holdings is controlled by the holding companies so individuals buying 2-3% will not make a difference," a source close to the Shishir Bajaj group had earlier said.
The other side of the family agreed with that view. "Our total holding in that company is around 45% of which around 40% is controlled by the Rahul Bajaj group," a source close to the Rahul Bajaj faction had earlier said.
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