Financial Daily from THE HINDU group of publications
Tuesday, Sep 20, 2005
Financial Daily from THE HINDU group of publications Tuesday, Sep 20, 2005 |
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Corporate
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Announcements BPL to retain alkaline battery business Our Bureau
Mr Ajit Nambiar
Bangalore , Sept 19 BPL Ltd, which has signed an MoU with Eveready Industries to sell its dry cell battery business to the latter, is keeping its alkaline battery business. It expects an export market for the batteries in the US, EU, UK, and Japan, where it is selling the batteries under the Sanyo brand name to retailers. The company had made significant progress in such efforts said Mr Ajit Nambiar, Chairman and Managing Director. Announcing the MoU with Eveready for selling the entire holdings in BSES Ltd, Mr Nambiar said the company was exiting the dry cell battery business since it did not want to enter the price sensitive paper jacket battery segment but instead wanted to focus on its core competence in entertainment electronics, medical electronics, engineering plastics and tooling for the auto and consumer electronics sectors. In February, BPL Ltd had commissioned PricewaterhouseCoopers for a strategic study of the company and on the basis of which the company is planning a re-launch of the BPL brand in October after its corporate debt restructure plan got the Kerala High Court approval and its 50:50 joint with Sanyo is ready to take off. The money from the sale will go toward the re-launch of the BPL consumer electronics business after its corporate debt restructuring and the Sanyo-BPL joint venture, said a company official. BPL, which plans to re-launch its brand in October expects to also enter the wireless space, with its mobile handsets that will leverage its brand, consumer awareness and acceptance and its distribution and manufacturing capabilities to launch the mobile handsets, portable telecom and wireless products in the next few months. After telecom and IT, healthcare is also expected to be a big market and BPL expects its medical electronics business - ECG machines, defibrillators etc - to grow well in the coming years. BPL Soft Energy, which has a facility to make 200 million batteries per year, in Karnataka, and a 10 per cent market share, has been valued at Rs 82 crore. Eveready is expected to complete its due diligence by end-October and assume the term loan liabilities and all other liabilities including bank borrowings of BSES Ltd. According to Mr Nambiar although the company was the latest entrant in the domestic dry cell business, "We have established the BPL brand with a 10 per cent market share in the business. This 10 per cent market share has been achieved by only addressing the metal jacket segment of the dry cell business. We have not addressed the paper jacket segment, which still constitutes 50 per cent of the industry.
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