Financial Daily from THE HINDU group of publications
Thursday, Oct 07, 2004
Welspun to get $15 m from IFC for plant expansion
Chennai , Oct. 6
WELSPUN India is expected to get a $15 m (about Rs 68 crore) funding from International Finance Corporation for its Rs 575-crore expansion project.
The company is likely to get the loan at LIBOR-linked rates. Also, Indian lenders led by State Bank of India, which will fund the Rs 400-crore debt portion of the outlay, are likely to get a 5 per cent interest subsidy out of the Textile Upgradation Fund (TUF).
Therefore, even the domestically raised rupee loans will be at low rates, the company's Director (Finance), Mr M.L. Mittal, told Business Line.
The project has also been financed in part by ICICI Venture Fund, which recently picked up a 14 per cent stake in the company.
The project is to construct a greenfield factory close to Anjar, Gujarat, to produce terry towels and bed sheets.
The factory, upon completion, will be able to produce 12,000 tonnes of terry towels and some 32 million metres of bedsheets, every year.
The factory will have all facilities to manufacture the products spinning, weaving, dyeing and finishing, and the attendant utilities.
Work on the project is on and the new plant is likely to go on stream by December, Mr Mittal said.
The Welspun Group is a Rs 2,000-crore business-house having interests spread across manufacture, exports and domestic sales of terry towels, bathrobes, speciality polyester yarns, cotton yarns, SAW pipes and pipe coatings.
The new plant is coming up on a 80-hectare barren stretch of land.
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