Corus countdown for Tata Steel offer period begins
The London Stock Exchange has placed Corus Group Plc stock on the "bid situation" watch list. This is reckoned as a "special condition" and the exchange alerted investors that the listed Corus security, which is part of the major LSE indices including the FTSE 100, was currently in an "offer period". The LSE’s general alert, however, did not, at this stage, specify whether the bid is hostile or otherwise.
The LSE move follows Tata Steel and Corus Group Plc’s announcements to the exchange under the relevant UK takeover rules over the weekend. In a bid situation, any investor is required to disclose immediately to the stock exchange their purchases or sales of the equity, both in cash and derivatives, until the formal offer period ends.
Under the provisions of the British takeover code, investors have been informed that: "This requirement (of trading disclosures) will continue until the date on which the offer becomes, or is declared, unconditional as to the acceptances, lapses or is otherwise withdrawn or on which the `offer period’ otherwise ends."
According to the latest disclosure by Corus it has in issue 89,80,50,502 ordinary shares of 50 pence each listed on the LSE. It also has issued bonds, convertible into 4,68,70,230 ordinary shares (due for conversion next year) and subordinated bonds convertible into 1,93,38,687 ordinary shares (also due in 2007). The steel maker’s issued shares include ADS, each representing two ordinary shares.
Following the norm, JP Morgan Securities and Quattro Global Capital Plc disclosed their positions in the Corus stock after the close of trading session last Friday.
The stock rallied 24 per cent during the past week to finish at 481 p, after touching the day’s peak at 490.23 on the LSE on October 6 with a traded volume of 6,45,06,732 shares.
Corus, which was created after the merger of British Steel and Dutch steel company Koninklijke Hoogovens in 1999, sold off its aluminium business in August this year and is in the process of disposing of its stake, held through its subsidiary Corus Stall BV, to the 50:50 Portuguese steel joint venture partner. Corus is the world’s ninth largest steel producer and the second largest in Europe with an annual production capacity of 18 million tonnes.
Corus share had rallied on the LSE in March this year after Financial Times had reported that the company had held merger talks with Ervaz Group of Russia.
Merchant banking circles in London told Business Line, a Tata Steel statement giving detailed offer might come after the Corus interim dividend payment period ended. The interim dividend payment period was to start on October 6 and close on October 16, after payment to the ADR holders.
Source:
