Even though domestic institutional investors such as LIC who are reportedly against the restructuring the proposals received 68 percent approval from minority shareholders, that is non-promoter shareholders. Word on the street is that FIIs voted in favour of the deal heeding the advice of foreign proxy firms ISS and Glass Lewis.
When the deal received negative press in India, the Ambuja managing director had said that Indian investors are emotional about cash.
However, Anil Singhvi, Founder, IIAS feels there is nothing wrong in being "emotional" with your investments. "When you look at the shareholding of Ambuja, 51 percent is held by Holcim, 31 percent is held by foreign institutional investors (FIIs) and about 11 percent is held by DIIs or domestic institutions and just about 8 percent is held by the retail investors," he told CNBC-TV18 in an interview.
He says it was a very high voting percentage. "If you look at the institutional shareholders including the DIIs it was 87 percent who voted. So, I am very encouraged by the fact that this being the first transaction of majority of minority and you have 87 percent people voting, which is very favourable and very encouraging aspect," he says.
Moreover, he feels ISS somewhere have erred. "I have seen their report. They have flawed in their whole analysis of this transaction and most FIIs have gone by ISS recommendation. This is the thing which we have been working on that how do we make FIIs those who participate in Indian markets to look at the Indian report rather than ISS. ISS really doesn't have any presence in Indian market," he says.
He feels there should have been a complete full blown merger of Ambuja and ACC . "There would not have been any cash and that is how the synergies would have been captured," he says.
However, investment advisor SP Tulsian is not all that negative. "You can always advocate for the merger. The same argument could have been done incase of Grasim and Ultratech also; what is the logic of existence of Grasim as a holding company? That is a subjective analysis. I agree that there are various options available. You can go for merger also; I am not disputing that. May be five years down the line the same thing can happen with ACC-Ambuja, same thing can happen with Grasim and Ultratech," he told the CNBC-TV18.
ACC stock price
On November 22, 2013, ACC closed at Rs 1049.90, up Rs 19.10, or 1.85 percent. The 52-week high of the share was Rs 1454.00 and the 52-week low was Rs 912.05.
The company's trailing 12-month (TTM) EPS was at Rs 56.23 per share as per the quarter ended September 2013. The stock's price-to-earnings (P/E) ratio was 18.67. The latest book value of the company is Rs 392.81 per share. At current value, the price-to-book value of the company is 2.67.
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