Unilever Buyback Shy of Target, But Leaves D-St Aflush with 19,220 cr

Over 32 crore shares tendered against offer to buy 48.70 crore

Unilever's stake in its Indian arm is likely to rise by a third to over 67% resulting in an inflow of $3.2 billion (. 19,220 crore) after its open offer for Hindustan Unilever met with a success rate of around 66%, according to market participants following the transaction. Over 32 crore shares were tendered to Unilever against the offer to buy 48.70 crore at the time of going to press. Life Insurance Corp has sold a substantial part of its stake in the open offer, said the sources. 
The money that will come in because of this single transaction amounts to 30% of the money foreign investors have pumped into domestic stocks so far this year and can offer some respite to the rupee, which has been relentlessly pummelled since April. On Thursday, the rupee snapped a three-day drop and ended at . 60.13, up 9 paise, on speculation over the success of Unilever's open offer, the largest in the history of India's capital 
    markets. 
    Unilever Plc and HSBC, the banker for the deal, declined to disclose the final numbers. Unilever had launched the offer at . 600 a share with the aim of raising its stake to 75% from the preopen offer of 52.5%, entailing an investment of . 29,220 crore. HUL Shares have Risen Nearly 21% Since April 
The Dutch company launched the open offer at . 600 per share to raise its stake in HUL to 75% from 52.5% at a cost of nearly . 29,220 crore. Shares of HUL have risen nearly 21% since the announcement of the offer on April 30. On Thursday, the stock ended at . 600.75, up 2.27%, just above the offer price. 
LIC (3.22% stake), Oppenheimer Developing Markets Fund (1.76%) and Virtus Emerging Markets Opportunities Fund (1.44%) were the biggest public shareholders. It is not uncommon for promoters to raise their stake in listed entities through open offers. Early this year, GlaxoSmithKline — promoters of GSK Consumer Healthcare — increased its stake in the Indian subsidiary to 72.46% from 43.16%, at an investment of Rs 5,222 crore. 
Tata Steel had launched voluntary open offers to raise its stake in subsidiaries Tinplate Company of India and Tata Sponge Iron. In the process, Tata Steel raised its stake in Tinplate to 75% from 61%. And in Tata Sponge Iron, Tata Steel's stake rose to 54.5% from 43.2%. 
Many foreign and domestic brokerages, including CLSA, Kotak, IDFC, ICICI and Anand Rathi, had recommended that minority shareholders subscribe to the open offer, whose price offered an attractive exit even in the best of times. They also warned the share price of HUL could correct after the offer as the company may face challenges in the coming quarters.