Hindalco Founders, Bankers Bought 80% of New Shares, Times Says

By Anil Varma

Oct. 11 (Bloomberg) -- Hindalco Industries Ltd.'s founders and underwriters bought as much as 80 percent of the new stock sold by the Indian aluminum maker after poor response from shareholders, The Economic Times reported.

The rights offer, which closed yesterday, may have fallen short of its 50.5 billion rupee ($1 billion) target by 5 billion rupees, the newspaper said, without saying where it got the information. Mumbai-based Hindalco's founders probably purchased as much as 50 percent of the shares, while banks underwriting the sale may have bought 30 percent, according to the report.

The five underwriters were ABN Amro Bank NV, Citigroup Inc., Deutsche Bank AG, DSP Merrill Lynch Ltd. and State Bank of India, the newspaper said.

Hindalco has lost 59 percent of it market value this year, compared with the 52 percent slide of the 61-stock MSCI India Index. The shares fell 7.9 percent to 408.12 rupees yesterday.

To contact the reporter on this story: Anil Varma in Mumbai at avarma3@bloomberg.net.