Financial Daily from THE HINDU group of publications
Saturday, Oct 30, 2004
Financial Daily from THE HINDU group of publications Saturday, Oct 30, 2004 |
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Corporate
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Mergers & Acquisitions Apollo Tyres completes due diligence of Modi Rubber tyre biz K.R. Srivats
Vadodara , Oct. 29 THE Rs 2,300-crore Apollo Tyres Ltd (ATL) has completed the "technical, financial and commercial due diligence" of the tyre business of Modi Rubber Ltd, a top ATL official has said. "The due-diligence on our part is over. Now it is for the Modi Brothers to make the next move and come up with a proposal to us after settling their issues with the financial institutions," Mr Neeraj Kanwar, Chief Operating Officer, ATL, told Business Line, when asked about the status of the due-diligence exercise embarked upon by the company in July this year. A senior company official said that the financial due diligence of Modi Rubber's tyre business was done for ATL by Deloitte. "Our own team did the technical due diligence as we feel that we are much better than Deloitte in assessing the tyre facility and the quality of machines. But, we decided that Deloitte would be better suited for studying the financials of Modi Rubber," the official said. ATL had in July this year informed the Bombay Stock Exchange that the company plans to acquire the tyre business of Modi Rubber by way of block purchase of assets and transfer of specified liabilities relating to Modi Rubber's tyre business. The acquisition, ATL had then said, was subject to the due-diligence, approval of settlement terms by banks, financial institutions (FIs), creditors, and other lenders of Modi Rubber. It would also take into consideration the approval of the rehabilitation scheme by BIFR, and other regulatory authorities as well as the approval by the board and members wherever applicable, of both Modi Rubber and Apollo Tyres. The senior management of ATL now feels that any further progress on the MRL issue depends on the initiatives that the Modi Brothers - Dr B.K. Modi and Mr V.K. Modi - are prepared to undertake in coming to a settlement with the FIs.
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