Financial Daily from THE HINDU group of publications
Sunday, Mar 12, 2006
Financial Daily from THE HINDU group of publications Sunday, Mar 12, 2006 |
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Corporate
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New Projects Markets - Public Offer Gangotri Textiles may hit market next month R.Y. Narayanan
On expansion mode Draft prospectus for public offer filed with SEBI. Premium to be determined by book building method. Land acquisition completed for expansion; orders for machinery placed.
Coimbatore , March 11
The second (follow-on) public issue of Gangotri Textiles Ltd (GTL), which is implementing a Rs 351-crore expansion cum integration plan, is expected to hit the market next month. The company has also achieved financial closure for its expansion project by inking a deal with a consortium of financial institutions for a Rs 257-crore loan with the balance to be met through internal accruals, proceeds from proposed public issue, promoter's contribution, subsidy, loan, etc. According to Mr Manoj Kumar Tibrewal, Managing Director, GTL, the company is waiting for SEBI's nod for its second public issue to raise Rs 55 crore from the market. The draft prospectus has been filed with SEBI and the issue might hit the market next month, subject to SEBI's approval. He said the premium for the public offer would be decided through the book building process. He said the textile industry in the country has been witnessing robust growth and the major companies in the sector have achieved global size in operations for which the Technology Upgradation Fund (TUF) had been of great help.
Land acquisition
Mr Tibrewal said the land acquisition for the expansion project has been made and orders for the machinery have been placed with the manufacturers. A ring-spinning unit of 19,200 spindles along with Two For One (TFO) twister to produce polyester cotton yarn is expected to go on stream by January 2007 and a ring-spinning unit of 31,200 spindles to manufacture cotton yarn would be ready by October 2007.
Consortium of banks
Mr Tibrewal said out of the total loan component of Rs 271 crore, the company has signed the deal for loan assistance of Rs 257 crore with a consortium of eight banks — Canara Bank, Corporation Bank, State Bank of Mysore, State Bank of Indore, State Bank of Hyderabad, State Bank of Travancore, United Bank of India and Syndicate Bank.
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