Financial Daily from THE HINDU group of publications
Sunday, Jun 30, 2002
Financial Daily from THE HINDU group of publications Sunday, Jun 30, 2002 |
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Corporate
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Mergers & Acquisitions Khaitans to shed 50 pc stake in WPIL Our Bureau
KOLKATA, June 29 THE B.M. Khaitan Group is in the process of restructuring its different businesses and as a part of it the group will offload 50 per cent of its stake in WPIL Ltd, previously known as Worthington Pumps. Addressing a press conference, Mr Deepak Khaitan, Vice-Chairman and Managing Director of the group's flagship company, Eveready Industries India Ltd, said that the stake would be sold to one of his "friends'' by the name of Mr V.N. Aggarwal. The Aggarwals have interests in casting and foundry and their annual business turnover is about Rs 40 crore. The Khaitans, at present, hold 90 per cent stake in WPIL and 45 per cent of it would be sold to Aggarwals. However, Mr Khaitan, who is Chairman of WPIL, preferred not to disclose the nitty-gritty of the deal. Instead, he said that everything would be finalised within one month. Meanwhile, the group is already looking for a buyer for its ailing company, Kilburn Engineering Ltd. It is already in the net of Board for Industrial & Financial Reconstruction and IDBI is the operating agency. Eveready Industries India Ltd, however, reported a net loss of Rs 53.32 crore for the year 2001-02, against a net profit of Rs 11.86 crore in 2000-01. The turnover also dropped by seven per cent to Rs 883.50 crore compared to Rs 950.92 crore in the previous financial year. In his comments on the results, Mr Khaitan said that though the batteries and flagship division improved its performance, depressed market conditions in the tea industry forced the company to report losses. The company has recently initiated a debt-restructuring programme, whereby its total debt has been reduced to Rs 800 crore. With its debt restructured, Eveready is saving about Rs 25 crore every year on interest payout. Still its interest burden during 2002-03 will be Rs 110-120 crore. Meanwhile, the company has also decided to regroup its businesses. The battery business will be clubbed along with the packet tea business as both depend extensively on retailing. A separate company will be floated for the bulk tea business. However, Mr Khaitan clarified that everything is still in a conceptual stage and it will take time to materialise.
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