The Hindu Business Line : Rejig plan to add value to Talbros Auto

In a bid to consolidate and build value for its flagship listed-company, Talbros Automotive Components Ltd (TACL), the Talbros Group has announced that it plans restructuring within the group.

Under the proposed restructuring, all auto component businesses of the group, represented by XO Stampings Ltd, Talbros International Ltd, and the IT arm, XQ Infotech Ltd, would be consolidated with TACL.

"This restructuring will give the company (along with its subsidiaries) manufacturing presence in steering and suspension parts, forgings and sheet metal components in addition to gaskets, and also take the total number of manufacturing facilities within the TACL group's fold to ten," Mr Naresh Talwar, Chairman, TACL said.

The appointed date for the consolidation of XO Stampings and Talbros International has been fixed as April 1, 2006.

The share swap recommended by Ernst & Young, the valuers appointed for the restructuring, is one share of TACL for 100 shares of XO Infotech Ltd, 105 shares of TACL for 100 shares of XO Stampings Ltd and 61 shares of TACL for 100 shares of Talbros International Ltd.

BMR & Associates acted as advisors for the restructuring. The said scheme has been accorded in-principle approval by the Board of Directors.

"This restructuring is a change that will bring with it consolidation of our strengths and core competencies, and add greater value to our business," Mr Talwar said.

According to the company, TACL is currently the market leader in the manufacture of gaskets for a variety of applications in the automobile industry and enjoys approximately 50 per cent of the market share.

Meanwhile, pursuant to the restructuring and merger of Talbros International, TACL would also hold majority stake in QH Talbros Ltd, a joint venture with the US-based Affinia Group.

QH Talbros manufactures steering and suspension components — tie rod ends, ball suspension joints, rack ends, drag links, control arms and steering linkage assemblies.