The Hindu Business Line : Andrew Yule divestment process to be over this fiscal

As part of the revival package, it is required to spin off its electrical and engineering businesses into separate cos while retaining the tea business under its own banner.

Our Bureau

Kolkata, Aug. 14 Andrew Yule & Co Ltd will complete the process of disinvestment in group companies within the current fiscal. This will mark the conclusion of its restructuring and rehabilitation exercise. The company was referred to the Board for Industrial & Financial Reconstruction in November 2002 after its net worth was eroded in 2001-02, according to Mr Kallol Datta, the company’s Chairman & Managing Director.

Addressing a news conference here on Thursday, Mr Datta said the company had posted a turnaround after a gap of seven years. During the year ended March 31, 2008, Andrew Yule recorded gross sales of Rs 184.40 crore and a net profit of Rs 8.61 crore.

Revival package

As part of the revival package approved by BIFR, the company is required to spin off its electrical and engineering businesses into separate companies while retaining its tea business under its own banner. The company has initiated the process of unlocking its investments in group companies with a view to generating the cash funding that is required under the revival package.

Towards this end, Andrew Yule will divest its 26 per cent equity stake in Phoenix Yule, 26 per cent in Tide Water Oil and 15 per cent stake in DPSC Ltd. With regard to Phoenix Yule, the 26 per cent stake will first be offered to the company’s German partner, Phoenix, which has the first right of refusal. The disinvestment process in Tide Water Oil is being monitored by a committee appointed by the Andrew Yule board.

Mr Datta said several power utilities are expected to submit expressions of interest in the DPSC stake. The last date for submission of the same has been fixed for September 9, 2008. DPSC is more of a power distribution company and its licensed area of operations is spread around 800 sq km in the industrial belt of Durgapur, Asansol and Raniganj.

Packet tea biz

According to Mr Dutta, Andrew Yule will once again venture into the packet tea business with an initial outlay of Rs 10 crore.

After writing down the par value of equity shares from Rs 10 to Rs 2 each, Andrew Yule had an accumulated loss of Rs 195 crore as on March 31, 2008.

This would be met by divesting equity in associate companies, Mr Dutta said.

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Andrew Yule to spin off electrical and engineering biz

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