Financial Daily from THE HINDU group of publications
Monday, Apr 03, 2006
Financial Daily from THE HINDU group of publications Monday, Apr 03, 2006 |
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Diversified Corporate - Restructuring Essar to pump in Rs 1,500 cr fresh equity Ambarish Mukherjee
New Delhi , April 2 The Essar group will pump in via Mauritius, fresh equity worth Rs 1,500 crore, in the group companies. According to company sources, the funds would be utilised partly for repaying of liabilities and partly to meet the costs of the various expansion plans in steel, power, shipping and all those that have already been announced. The money would be invested through a clutch of wholly owned subsidiaries of the Mauritius-based investment arm of the Group, Essar Infrastructure Holdings Ltd. The funds would be invested initially in the capital of Teletech Investment (India) Ltd. Teletech in turn, would funnel the investment into the Group's steel, shipping, power and oil ventures.
Plans okayed
The company had sought the Government's approval for its plans in February this year. The plans have been okayed by the Foreign Investment Promotion Board (FIPB) on March 7 and would be placed before the Cabinet Committee on Economic Affairs (CCEA) soon, officials said. According to plans submitted to the Government, Essar Holdings Private Ltd (EHPL), controlling investments in domestic ventures, will be merged with Teletech. EHPL is the holding company for the group's main listed entities Essar Steel, Essar Shipping, Essar Power and Essar Oil. EHPL's holding in these companies would be transferred to Teletech after the merger. The FIPB has also approved the group's plan to convert the original investments made in foreign currency by the Cyprus-based Infotech into Teletech from `non-repatriable' to `repatriable' investment — an arrangement that would allow the company to repatriate profits.
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