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Neha Kaushik

The package to be submitted to BIFR soon

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New Delhi Feb. 3 Modi Rubber Ltd is currently working out an estimated Rs 300-350 crore revival package which would be submitted to the Board for Industrial and Financial Reconstruction (BIFR) shortly, sources said.

In what could be seen as the first step towards implementation of the package, Mr VK Modi has bought the 44 per cent stake held by banks and financial institutions in the company.

Confirming the development, Mr Alok Modi, Director, Modi Rubber, said the stake was purchased for Rs 101 crore last month, following which Mr VK Modi's stake in the company has increased to 64.45 per cent. He has also been appointed as the Managing Director of the company.

Mr VK Modi's acquisition of the stake held by financial institutions also indicates an end to the rift between him and his brother Mr BK Modi, who had earlier indicated his interest in purchasing the stake held by financial institutions.

Mr BK Modi had offered to buy the stake at Rs 70 per share, while Mr VK Modi offered Rs 91 per share but sought permission to make the payment in one month. Subsequently, the financial institutions accepted Mr VK Modi's bid, a development which was opposed by Mr BK Modi, as he decided to revise his offer.

However with the recent development, the company seems a step closer to restarting production.

The company's facilities have been closed since August 2001. Mr VK Modi has constituted a team of engineers, which will inspect the plants and start repairs shortly.

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