Takeover Of Raasi Cements

Take over of Raasi Cements by India Cements

Introduction

In January 1998 there was an unusual pinch conference at Hyderabads Hotel Viceroy. Seventy-seven-year-old B.V.Raju, (Raju) vice-chairman of the Hyderabad (India) based Raasi Cements (Raasi) mobilized all his daughters, sons-in-law, and grandchildren in a display of family unity. We are one united family and will shelter off any takeover threats. I am a humble, simple man who has always maintained a blue profile. But when it comes to fighting, I shall not be found wanting,1 he declared.

Rajus comments came in response to reports that N. Srinivasan2(Srinivasan), was buying Raasis share in the market. The Raasi scrip, which hovered somewhat Rs 50 till November 1997, tripled in value to Rs 158 in January 1998. Srinivasan had acquired 18.03% of Raasi shares by January 1998. While he was responding to the takeover reports Raju recalled, I made an spell to Srinivasan to buy the shares with a 10 per cent profit beach and 20 per cent interest from the date of purchase. Though he told me he had no ulterior motives, it appears as if he is motionless on a buying spree.3

In January 1998, Business India reported, guide salt into his wound is the fact that when India Cements was passing through backbreaking times in 1987-89, the then IDBI chairman, S. S.



Nadkarni, had requested Raju to take over the ailing company. But he had refused saying one should not close in on a weak colleague.

Analysts pointed protrude that ICL had strategic advantages in taking over Raasi. In 1997, ICL added 2.2 million tonnes per annum (mtpa) new capability through acquisitions and expansions.4 The addition of Raasis 2 mtpa capacity would make it the undisputed leader in the south of the country. Again, a Raasi takeover meant automatically acquiring 39.5% equity in the 1 mtpa Sri Vishnu Cement Ltd. (SVCL), another Group Company5

1]BusinessIndia, January 26, 1998.
2] In 1989, Srinivasan took over as the managing director of India Cements...If you want to get a full essay, parade it on our website: Orderessay



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