Financial Daily from THE HINDU group of publications
Sunday, Oct 03, 2004
Financial Daily from THE HINDU group of publications Sunday, Oct 03, 2004 |
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Corporate
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Alliances & Joint Ventures Hindustan Seals top bidder for Pennar Aluminium Dinesh Narayanan
Mumbai , Oct. 2 THE Kolkata-based Hindustan Seals Ltd, now called Manaksia Ltd, is likely to take over the ailing Pennar Aluminium Ltd. Hindustan Seals, a Rs 700-crore privately held company, has emerged as the highest bidder for the Hyderabad-based sick aluminium maker, beating a rival bid from the AV Birla Group. According to reliable industry sources, Hindustan Seals hasbid at a price between Rs 12 and Rs 15 per share. Rumours of Pennar's imminent takeover electrified the otherwise sleepy counter on the BSE, which saw the share rise nearly 12 per cent to close at Rs 5.6, with almost 33 lakh shares changing hands. Mr Basant Kumar Agarwal, Chairman, Hindustan Seals, confirmed that his company was the top bidder for Pennar. He, however, declined to reveal the price at which Hindustan Seals bid for Pennar. The Board for Industrial and Financial Reconstruction declared Pennar Aluminium sick in April 1998. IDBI, ICICI Bank and State Bank of India, the company's major lenders, transferred itsassets to the Asset Reconstruction Company (India) Ltd in May this year. Several metal makers, including Sterlite Industries and Hindalco, have been trying to take control of the 45,000 tonne per annum scrap-based aluminium plant of Pennar ever since it became sick. However, their proposals did not find favour with the lenders. Other companies that had in the past shown interest in buying the company are Danish metals major Danmetal A/S and locals Raviraj Foils and Vatsa Music. An acquisition of Pennar will help Hindustan Seals augment its aluminium manufacturing capacity to 93,000 tonnes per annum (tpa). "We currently have a 12,000-tpa plant and are in an advanced stage of setting up another 36,000-tpa rolling mill at Haldia," Mr Agarwal told Business Line. Hindustan Seals is a major manufacturer of crown caps (found on soft drink bottles) and mosquito repellent coils in Asia. Its clients include Coca Cola, Reckitt Benckiser, Jyoti Laboratories, Shaw Wallace and United Breweries. The company began a Rs 500-crore expansion last year that saw it enlarge the steel and aluminium businesses with manufacturing forays in Nigeria and Nepal. Hindustan Seals is setting up a Rs 300-crore plant in Haldia that will produce one lakh tonnes of cold- rolled steel per year and another plant with a capacity to make one lakh tonnes of galvanised, colour-coated steel sheets, Mr Agarwal said.
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