Financial Daily from THE HINDU group of publications
Saturday, Mar 23, 2002
Financial Daily from THE HINDU group of publications Saturday, Mar 23, 2002 |
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Corporate
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Mergers & Acquisitions Paying Melodeon: Grasim seeks shareholders' nod Suresh Krishnamurthy
GRASIM Industries is seeking shareholders' consent to pay Rs 15 crore to Melodeon Exports, Mumbai, for taking over the company's textile unit located in Gwalior. Grasim will pay this amount in instalments spread over a period of 90 days from the date of completion of sale transaction (indicated as April 30). Grasim has also undertaken to bear the stamp duty, registration charges and other incidental expenses relating to the sale. Grasim will receive Rs 1 lakh from the purchaser as sale consideration. In the explanatory statement, attached to a notice to shareholders, the company indicated that the textile undertaking, which has 1,281 employees, had been incurring losses for the past few years and the liabilities were mounting. The statement also said that the book value of assets net of current liabilities was approximately Rs 12 crore. The company contended that the return on capital employed for the textile unit was negative. In its view, it makes more economical and profitable to manufacture its brands — Grasim and Graviera — - under a single location at Bhiwani. The company is seeking the consent of its shareholders through a postal ballot and the result of the ballot will be announced on April 27.
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