The Hindu Business Line : SPS Group buys Indo American Electric

Kolkata June 25 The Rs 2,000-crore turnover SPS Group of Companies, which has interests in the steel, entertainment and hospitality sectors, on Monday announced the acquisition of the Durgapur-based insulated copper wire manufacturing company Indo American Electric Company Ltd for Rs 6.5 crore.

Acquisition

The group has also acquired 52 per cent of Bharat Biscuits, a Kolkata-based biscuit company that has been closed for the last four months. It will pump in Rs 3 crore to revive the company and an additional Rs 4 crore will be invested to increase the manufacturing capacity from 370 tonnes per month (tpm) to 1,000 tpm.

Indo American Electric Company Ltd had run into losses and was referred to the Board for Industrial & Financial Reconstruction (BIFR). Syndicate Bank had been appointed the operating agency in this regard. The company's factory in Durgapur has been closed for the last 15 years.

According to Mr Bipin Kumar Vohra, Chairman & Managing Director of the SPS Group, Indo American Electric had been engaged in the manufacture of insulated copper wires and had among its customers companies such as Crompton, Kirloskar, Emco, etc.

Investment

Mr Vohra said the SPS group would initially invest Rs 10 crore in the modernisation of the Durgapur factory. Rs 10-15 crore more would be spent on a forward-integration transformer-manufacturing facility that would be set up there.

While all 185 workers of the factory had resigned, the new management would have the discretion to engage them on a contractual basis. When fully operational, the Durgapur facility would engage 350-400 workers, Mr Vohra said.

With regard to the acquisition of the equity stake in Bharat Biscuits, Mr Vohra said it would mark the SPS Group's foray into the foods business. "While 110 workers are currently engaged by Bharat Biscuits, the total number of workers would go up to over 200 after expansion of the manufacturing capacity," he added.

More Stories on : Mergers & Acquisitions | Sick Units | Diversification | Metals

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