With reference to the news item appearing in media reports that `UK-based steel trading major Stemcor may buy 20% stake in Sathavahana Ispat, Sathavahana Ispat has clarified that the company categorically denies any such move to increase the holding of Stemcor, in the company.

It said “As of now the company does not intend to issue any further shares above 15% to Stemcor, nor intends to divest any management control.”

The release said that “The news item is therefore, hereby denied.”

ET had reported that UK based steel trading major Stemcor, which owns minority stakes in various Indian steel companies, is planning to increase its stake in one of them, Sathavahana Ispat.

The report said that “Stemcor, which currently owns 14.7% equity in Sathavahana, is likely to buy at least 20% stake in the Indian company, as any move to increase its holding to over 15% would automatically trigger a 20% open offer under SEBI's takeover norms. SEBI's takeover norms are triggered if a company's shareholding in another company touches 15%.”

The report had cited Mr Mathew Stock MD of Stemcor India as telling ET that “We are talking to the promoters of Sathavahana and are looking at all options. It's too early for me to comment as we haven't finalised any option as yet.”

In 2008, Sathavahana Ispat sold a 14.69% stake to Stemcor Holdings to raise funds for expansion and to meet its raw material needs. Sathavahana had issued 4.9 million new preferential shares to Stemcor then, at INR 60 a share raising about INR 30 crore.

Sathavahana Ispat makes pig iron at its plant in Karnataka.

(Sourced from MyIris and ET)