Financial Daily from THE HINDU group of publications
Sunday, Dec 04, 2005
Financial Daily from THE HINDU group of publications Sunday, Dec 04, 2005 |
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Tyres Corporate - Mergers & Acquisitions Ruia group plans to open Dunlop factories in 9 months — Looking to invest Rs 150 cr in first phase Our Bureau
Kolkata. Dec. 3 THE Kolkata-based Ruia Group has taken over the controlling stake in Dunlop India Ltd, Falcon Tyres and Indian Tyre and Rubber (ITR) from theDubai-based Jumbo group owned by the family of the late M.R. Chhabria. The block deal was sealed for a consideration of roughly Rs 200 crore on Friday. Additionally, Mr Ruia is looking to invest roughly Rs 150 crore in the initial phase of running the units under the new management. The Ruia Group has acquired 74 per cent stake in Falcon, 68 per cent in Dunlop and 99 per cent in ITR. Announcing the takeover, the group Chairman, Mr P.K. Ruia, told presspersons here today that he expected to reopen both the closed facilities of Dunlop at Sahagunj in West Bengal and at Ambattur in Chennai in eight to nine months. The Sahagunj facility, the bigger of the two, has remained closed since 1998. The revival of the company is expected within 18 months of the re-opening of facilities. Though listed in BIFR, he said that the "takeover does not require BIFR approval". He said Dunlop has a book-liability of Rs 600 crore including Rs 130 crore payable to banks and FIs. The asset value works out to roughly Rs 800 crore. "We are yet to discuss loan settlement issues with banks and FIs," he added. "The Ambattur facility is in better health and is expected to be reopened in next six months. The reopening will be easier here as the earlier management had already had negotiations with the trade unions on revival and related issues. The factory, which has 1,100 employees, will be producing its entire range of tyre products," he said. At Sahagunj, however, the Ruia Group is planning to first focus on producing the industrial rubber products.
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