The Hindu Business Line : Bhagyanagar Metals, Surana Tele to undergo demerger, restructuring

LISTED companies Bhagyanagar Metals , Surana Telecom , and unlisted Surana Infocom Ltd, and Value Infrastructure and Properties will go through a complex process of restructuring, demergers and consolidation of specific businesses.

This will create four listed entities, which will consolidate the telecom, metals and infocomm businesses. Another listed entity for infrastructure will be carved out by extracting the infrastructure component of other companies.

Following the restructuring, while Surana Telecom Ltd (STL) will retain its name focussing on telecom, Bhagyanagar Metals will become Bhagyanagar Infrastructure Ltd (addressing infrastructure), and a new company, Bhagyanagar Telecom Ltd, will come into existence. Simultaneously, Surana Infocom will become Bhagaynagar Metals Ltd, representing the metals business of Bhagyanagar Metals before the restructuring.

These changes will be subject to statutory approvals, shareholders nod and clearance by the courts.

The Managing Director of Surana Telecom , Mr Narender Surana, told Business Line that this development would pave the way for four listed entities. Post-merger, the book value of Bhagyanagar Metals will be Rs 45.

The Company Secretary of Surana Telecom , Mr S. Balachandra, said the changes would be effective April 1, 2005 and be based on the approval of the High Court of Andhra Pradesh.

Upon de-merger of the metals division of the Bhagyanagar Metals , its shareholders will hold existing Bhagyanagar Metals (BML) shares (which will become shares of the infrastructure company) and in return get 20 shares of Bhagyanagar Telecom (new company) for every 100 shares of BML held. They will also get five shares of the new Bhagyanagar Metal for every 100 shares of BML held.

Shareholders of Surana Telecom will hold the STL shares and get 28 shares of BML Infrastructure for every 100 shares of STL held. Further, Surana Infocom (SIL) shareholders will get 132 shares of BML Infrastructure for every 100 shares of SIL.

The existing shares of Value Infrastructure and Property Private Ltd (VIPL) will get extinguished and they will get 79 shares of BML Infrastructure for every 100 shares of VIPL held.

The exchange ratios pertaining to the scheme have been determined by the board based on their independent judgment and also the valuation provided by chartered accountants Ch. G. Krishna Murthy & Co.

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