Financial Daily from THE HINDU group of publications
Tuesday, Feb 18, 2003
Financial Daily from THE HINDU group of publications Tuesday, Feb 18, 2003 |
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Corporate
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Restructuring Eicher mulls selling Thane gear unit Our Bureau
NEW DELHI, Feb. 17 AS part of its initiatives to reduce losses, Eicher Ltd is considering to sell one of its gear units located in Thane. The company today informed the Bombay Stock Exchange (BSE) that it had "received a proposal for its consideration from a party for the purchase of the Eicher Demm Thane (EDT) unit of the company comprising of immovable and movable assets, current assets and liabilities together with all employees. At present the proposal is to conduct a confidential due diligence exercise and then negotiate the terms and conditions including price." The Board of Directors took note of the same in its meeting held on February 15. Commenting on how long the diligence process is likely to take, a company official told Business Line, "It is difficult to give an exact schedule but it may take about six to eight weeks because the process is yet to start." A further disclosure will be made if and when the final offer is received including the fixation of price and execution of definitive agreements for divestment of the aforesaid unit. If no agreement is finalised appropriate intimation will be made with regard to the termination of the exercise, the company said in its communiqué to BSE. The gear business comprising of the Eicher Demm Thane (EDT) unit and Eicher Demm Parwanoo (EDP) unit (excluding business pertaining to gears manufactured for captive consumption for tractors business of the company by a dedicated manufacturing line at Parwanoo) incurred a loss of Rs 5.24 crore before interest and other un-allocable expenses and Rs 1.22 crore before interest and other un-allocable expenses for the financial year ended March 31, 2002 and for the period of nine months ended December 31, 2002 respectively. The Eicher Demm Thane unit is involved in the manufacture of various kinds of gears including crown wheel and pinions.
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