A rack of pistons await installation. (Photographer: Mark Elias/Bloomberg)

SEBI Sets Price For Tenneco’s Open Offer For Federal-Mogul Goetze

The market regulator asked U.S.-based Tenneco Inc. to increase the open offer price at which it wants to acquire shares of Federal-Mogul Goetze (India) Ltd. after shareholders of the locally listed auto parts maker raised concerns.

Securities and Exchange Board of India revised the open offer price to acquire 25.02 percent stake in the Indian arm of Federal-Mogul to Rs 608.46 per share, according to a filing by Federal-Mogul Goetze.

This is the third attempt at an open offer after Tenneco acquired the piston maker from the Carl Icahn-owned Federal Mogul in a $5.4 billion deal in early 2018. In April 2018, Tenneco had set the price for a mandatory offer for sale at Rs 400 per share. The company then announced a second open offer at Rs 420.05 per share in October.

Federal-Mogul Goetze said it does not have the methodology of the latest price arrived at. “Neither the acquirer nor Federal-Mogul Goetze (India) Ltd. have been granted an opportunity to review or verify the underlying methodology of any report or other analysis that was relied upon by SEBI in directing the acquirer to revise the offer price,” the piston maker said in its stock exchange filing. “We understand that the acquirer is presently reviewing the communication and has requested SEBI to provide the basis (and the valuation report, if any) for the revision of the offer price.”

SEBI also advised the company to take the required steps to ensure compliance with the minimum public shareholding requirement as per the Securities Contracts (Regulation) Rules, 1957 and SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015.

Federal-Mogul Goetze’s shares fell as much as 3.81 percent to Rs 553 apiece in today’s trade. That compares to a 0.37 percent rise in the benchmark Sensex.