The Hindu Business Line : Birla group not to divest its stake in Century Textiles

The GP-CK Birla group is not planning to divest its stake in Century Textiles. The group holds 1.66 per cent stake in Century Textiles through Orient Paper.

Mr M.L. Pachisia, Managing Director of Orient Paper, told Business Line on Monday that it is not offloading its holding in Century Textiles, a company controlled by Mr B.K. Birla and Mr Kumar Mangalam Birla combine.

Pilani Investments & Industries Ltd, the holding company of BK-Kumar combine, currently has 42 per cent in Century, while Kesoram Industries, a BK Birla-controlled company, has another three per cent.

Interestingly, in Pilani, MP Birla group has around 25 per cent stake. Separately, Birla Corporation, the MP Birla group flagship, holds around two per cent in Century Textiles.

In the backdrop of the on-going dispute over succession of the MP Birla group, there was a strong market speculation that the GP-CK Birla group would offload its stake in Century in favour of BK-Kumar combine.

Orient Paper

Meanwhile, promoters of Orient Paper and Industries Ltd have, of late, raised their stake marginally in the company through market purchases. However, group sources maintained that there was no plan to raise the promoters holding to 51 per cent level.

Promoters and persons acting in concert raised their combined holding in Orient Paper to 30.04 per cent on June 29, 2006 from 29.89 per cent as on March 31, 2006. Incidentally, as on March 31, 2005, the promoters combined holding was placed at 30.10 per cent of the total equity.

A string of six private corporate bodies, controlled by the promoters, currently hold another 10.57 per cent.

According to observers, promoters' security stems from the total controlling stake of around 41 per cent in the company. The public holding as on March 31, 2006 was at 17.54 per cent, down from 24.01 per cent as on March 31, 2005. Mutual funds' holding have, however, nearly doubled in the company to 14.23 per in one year till 2006 March-end.

The promoters' holding in group's other outfit, Hindustan Motor, is a little over 29 per cent, while the private corporate bodies hold around 17.09 per cent and the public holding is placed at 41.29 per cent of the total paid up capital.