Mangalore Chem shares jump on reports UB approached

Last Updated: Fri, Feb 24, 2012 06:08 hrs

Shares in Mangalore Chemicals & Fertilizers Ltd rose as much as 16 percent on Friday after newspaper reports said UB Group Chairman Vijay Mallya had been approached by potential buyers of UB's 30.4 percent stake in the company.

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Mallya, who heads the cash-starved Kingfisher Airlines Ltd, has been approached by Zuari Industries Ltd and Chambal Fertilisers & Chemicals Ltd to buy UB's shares, the Business Standard reported, citing unnamed sources.

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The Economic Times said Coromandel International Ltd , as well as Zuari, had also expressed interest in buying UB's stake.

A spokesman for Zuari denied that his company had approached UB, while spokesmen for Chambal and Coromandel said they did not comment on market speculation. A UB Group official did not respond to a request for comment.

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UB Group's stake in Mangalore Chemicals would be worth about $30 million at current prices.

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Kingfisher, which has a debt of at least $1.3 billion, has cancelled scores of flights over the past week and has so far been refused fresh financing from its top lenders.

Mallya is also chairman of United Breweries (Holdings) Ltd, a conglomerate with annual sales of more than $4 billion.

Shares in Mangalore Chemicals were up 11.18 percent at 10:10 a.m. (0440 GMT), after rising as much as 16.3 percent in early trading. Zuari was up 1.44 percent, Chambal was up 0.8 percent and Coromandel was up 0.34 percent. The overall market was down 0.21 percent.

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