Financial Daily from THE HINDU group of publications
Friday, Jan 02, 2004
Mergers & Acquisitions
Indian promoters buy out US partner in Rain Calcining
Hyderabad , Jan. 1
THE Indian promoters of Rain Calcining Ltd (RCL), the Hyderabad-based Rs 333-crore calcined petroleum coke and power producer, have acquired the entire stake of 24.79 per cent held by the company's foreign promoter, Reliant Energy Rain.
Reliant Energy is a subsidiary of the US-based Houston Industries Energy Rain located at Mauritius.
According to market observers, this as one of the major inter-se transfer deals in the Indian corporate world in the recent past.
RCL's calciner, which can manufacture three lakh tonnes of calcined petroleum coke, is Asia's largest such facility.
The company also has a 50 MW power project.
Reliant Energy Rain is an indirect wholly owned subsidiary of the US-based CenterPoint Energy International (CPE), with whom RCL had initially entered into a technical assistance agreement (TAA) for the construction and operation of a 52.5 MW power plant attached to the calciner.
A senior RCL official said that Sujala Investments, which is controlled by the Indian promoters of the company, acquired 3.21 crore equity shares of Rs 10 each from Reliant Energy Rain.
Following this, the aggregate number of shares held by the company now stands at 3.25 crore.
Meanwhile, Mr Y. Santoshkumar Reddy, Executive Director, RCL, and persons acting in concert with him have together acquired 77.04 lakh equity shares of Rs 10 each from Sujala by way of inter-se transfer of shares among the promoters.
Following this, the aggregate number of shares held by Mr Reddy and the persons stands at 77.35 lakh equity shares.
Earlier, the Indian promoters had a stake of 25.48 per cent in RCL's paid-up equity of Rs 129.48 crore, with the foreign promoters holding 29.79 per cent.
Among the foreign promoters, Applied Industrial Materials Corporation will continue to hold five per cent stake.
Asian Finance Investment Corporation holds 1.08 per cent equity under the foreign institutional investors category.
The Indian promoters can now consolidate their equity holding to little over 50 per cent, Mr G.R. Chary, General Manager (Finance) and Compliance Officer, RCL, told Business Line.
According to him, the company's TAA with CPE expired on July 16 last year.
"As the technology for the power plant has been fully absorbed by the company, it was felt that the services of CPE are no longer necessary, and as such the TAA was not extended."
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