Pratim Ranjan Bose
Kolkata, Nov. 24
THROUGHOUT this year a number of names had hit the media headlines regarding acquiring of Jumbo Group's controlling stake in three tyre companies, especially the Bangalore-based Falcon Tyres.
The names in circulation were mostly from the tyre sector in the country and even one London-based group, which so far had a little or no interest in the related sectors.
The Kolkata-based Ruia group, which has no existing relation to the tyre industry and now seems to be closer to such acquisition possibility, had been able to keep itself out of the media glare. This is despite the fact that the Ruia group Chairman, Mr Pawan Kumar Ruia, was after it for no less than six months.
The group had hit the headlines in a similar fashion when it had outbid a number of well-known players during the disinvestments of the erstwhile central public sector enterprise, Jessop & Co in 2002. The acquisition (for Rs 18 crore) was made through its flagship Ruia Cotex in September 2003.
The latter is a textile yarn manufacturing company, which has of late, witnessed a decline in its fortunes leading to the closure of two of its three manufacturing units. The company is now up for sale. Kamlapur Sugar, another old group company having its facility in Uttar Pradesh, however, is doing well.
Jessop has witnessed an improvement in its performance under Ruia leadership. After almost a decade the company has come back into the black with over Rs 4 crore of net profit on close to Rs 80 crore turnover and according to the latest reports is continuing its uptrend in 2005-06. And, according to Mr Ruia , the company is heading for Rs 1,000 crore turnover in the next few years. During the last two years, the Ruia group has been reaching out for a number of acquisition opportunities especially in the metals and allied sectors thrown open by the State governments of West Bengal, Jharkhand, Orissa and the Central Government.
In West Bengal, it had participated in the initial rounds of the most-talked about disinvestments in recent times of Great Eastern Hotel. It is also one of the aspirants for acquiring control of the closed heavy engineering major Mining and Allied Machinery Corporation (MAMC) in Durgapur.
While the Centre is yet to get through with the disinvestments of MAMC, the Ruia Group had acquired the plant and machinery of the closed foundry of Mukund Ltd in early 2005 through a special purpose vehicle for setting up a bogie and coupler plant in Durgapur.
The plant, now being commissioned, will boost the prospects of Jessop.
The group had also emerged as the highest bidder for two smaller Orissa PSUs - Hirakud Cables (a sick aluminium conductor wire and transmission tower manufacturing facility) and IDCOL Rolling Mills Ltd.