Reliance Industries has made a strange open offer for Network18, TV18 and Infomedia18, the Network18 group companies that is looking to buy following an acquisition of shares from Network18's promoter group. That acquisition has triggered an open offer from RIL and its group companies, but what is very strange is that the open offers being made are much lower than the closing market price of shares for these companies yesterday, and the shares have run up even more; in case of Network18 Media and Investments, the shares closed 10% higher than the offer price yesterday, and so far, today have run up to around 19.3% higher than the offer price. Open offers are typically higher than the market price. We wonder if this open offer is built to fail. If you can figure this out, please do leave a comment. The details of the open offer(s): Network18 Media & Investments Ltd (pdf) - Open offer for the acquisition of up to 22,99,46,996 equity shares of Network18 Media & Investments Limited, by IMT for Rs 41.04 each, a total of Rs 943.70 crore. The shares have a face value of Rs 5 each. - Current market price of Network18 is Rs 48.95, up Rs 3.80 (up 8.42%) from yesterday. This is 19.3% higher than the offer price. In fact, yesterdays closing price was Rs 45.15, which is 10% higher than the offer price. - The acquisition constitutes the remaining 21.96% of the Emerging Voting Capital of Network18 Media & Investments Limited. - The…
