Reliance MF set to join FIs to oppose Pfizer’s open offer

RELIANCE Mutual Fund is all set to join a raft of local financial institutions and not participate in US pharma company Pfizer's open offer to raise its stake in its Indian unit, an official in the country's biggest fund house said. Pfizer, which owns 41.5% in its Indian subsidiary, wants to raise its stake to 75% and has offered to buy shares from the company's shareholders at Rs 675 a share. The US company plans to spend around Rs 680 crore. But the stock was last traded at Rs 722 last week, making the likelihood of other shareholders tendering their shares to the company next to impossible.
    "We are not participating in the offer. We think the open offer would fail as a sizeable number of its shareholders are now opposing Pfizer's price," an official in Reliance Mutual Fund told ET.
    Reliance Mutual Fund and the other institutions jointly own 25.5% in Pfizer's Indian unit. Pfizer, which has until June 18 to revise its price, said the open offer price was at a 8.6% premium to NSE closing share price of Rs 621.55 on April 9, the last trading day before the open offer was announced. The offer closes on June 29. A Pfizer spokeswoman also said the open offer price represented a 22.2% premium over Pfizer's average price for a 30-day period to April 9. Indian institutions have in recent days strongly objected to the way some MNCs operate here. They resisted Pfizer's plan to raise salaries of its top management.
    dev.chatterjee@timesgroup.com 

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