Financial Daily from THE HINDU group of publications
Monday, Jan 30, 2006
Financial Daily from THE HINDU group of publications Monday, Jan 30, 2006 |
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Corporate
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Mergers & Acquisitions Industry & Economy - PSU Ruia group completes acquisition of IDCOL Rolling Mills — Hirakud Cables takeover in final stages Pratim Ranjan Bose
Kolkata, Jan. 29 THE Kolkata-based Ruia Group has completed acquisition of the closed Orissa Government PSU, IDCOL Rolling Mills Ltd (IRML). The acquisition of ailing Hirakud Cables, another State PSU, is also in the final stages of completion. The total acquisition cost inclusive of liabilities for the two companies is estimated to be close to Rs 20 crore. Both the companies are located at Hirakud in Orissa. According to sources, post acquisition, IDCOL Rolling will be renamed as Hirakud Industrial Works (HIW) Ltd. The operations of both the companies will be integrated with engineering and construction major Jessop & Co. Set up in 1968, IRML was previously a unit of the State undertaking Industrial Development Corporation of Orissa Ltd (IDCOL) and was converted into a wholly owned subsidiary in 2002. The company was put on the block for divestment in 2003. The rolling mill has a capacity to manufacture 25,000 tonnes of torque steel, angle, flat, rounds and other rolled products. The company was closed since August 1998. The total acquisition cost of IRML was close to Rs 7 crore including the bid price of Rs 1.11 crore and other financial liabilities. Ruia Group has also taken over the liability of the existing 25 employees in IRML. The acquisition will provide backward integration to Jessop's fabrication business. Ruia Group had emerged as the highest bidder for IRML in June 2005. However, the group delayed taking over the company as acquisition of Hirakud Cables was postponed due to court cases challenging the dis-investment. Ruias emerged as the highest bidder for Hirakud in April 2005. Hirakud Cables is an aluminium wire and power transmission tower manufacturer. The company was once profitable and had posted over Rs 100 crore of turnover before turning sick. According to the Ruia Group, the acquisition would provide forward integration to Jessop's fabrication business.
Related Stories: More Stories on : Mergers & Acquisitions | PSU
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