The Hindu Business Line : Electrolux to invest $50 m in Indian venture

THE overseas parent of Electrolux Kelvinator Ltd, Electrolux AB of Sweden, has decided to invest $50 million in its Indian venture within the next couple of months through a rights issue. A capital investment of $75 million has already been made in the company since inception in the 1980s. The rights ratio has been fixed at 10 new equity shares for every seven shares held.

Stating this at a news conference here on Friday, Mr Ashok Barat, Business Controller of Electrolux Kelvinator Ltd, said the proceeds from the rights issue - to be issued at par for Rs 10 per share - would go towards financing capital expenditure aimed at upgrading and augmenting the company's existing household appliances manufacturing facilities. A part of the issue proceeds would also go towards retiring the company's debts, which currently stand at Rs 360 crore.

The overseas parent of Electrolux Kelvinator Ltd holds 76 per cent of the equity stake in the company while an Indian partner and the domestic public hold the balance. The company, which notched a turnover of Rs 460 crore during the year ended December 31, 2001, hopes to register a turnover of Rs 600 crore by the end of the current calendar year.

Mr Barat said all the three refrigerator plants of the company would be upgraded to manufacture CFC-free refrigerators from January 2003. At present, the company has an installed capacity to manufacture 1,20,000 refrigerators per annum. It holds a 26 per cent share of the domestic market for refrigerators. Besides, it manufactures washing machines, which account for nearly Rs 75 crore of the company's turnover.

The company on Friday announced the launch of `Washy Talky', stated to be the "world's first talking washing machine." Priced at Rs 16,690, the Washy Talky has been designed, developed and manufactured in India.

According to Mr Barat, the market for washing machines in India is currently estimated at one million units per annum and 90 per cent of this comprises top-loading models. Electrolux Kelvinator has manufacturing facilities for both top-loading and front-loading models. A corpus of Rs 30 crore has been earmarked for marketing the Electrolux Kelvinator brand of products in the current calendar year.

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