Financial Daily from THE HINDU group of publications
Saturday, Apr 19, 2003
Financial Daily from THE HINDU group of publications Saturday, Apr 19, 2003 |
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Automobile Components Corporate - Restructuring Lakshmi Auto `under revamp' M. Ramesh
CHENNAI, April 18 THE recent decision of Lakshmi Auto Components Ltd (LAC) to acquire the entire paid-up equity capital of 2.5 lakh equity shares of Rs 10 each at par, of Sundaram Auto Components Ltd (SACL), an unlisted company is linked to restructuring of the component business portfolio of the former, according to sources close to the TVS Group. SACL, which currently has no manufacturing operations, could end up taking over a part of the existing business of LAC, the sources indicate. One option that is being considered is to shift the rubber and plastic moulded items on to Sundaram Auto Components Ltd. It may be mentioned that on October 1, 1998, LAC took over two group companies, viz., Sundaram Plastics Ltd and Harita Rubber Products Ltd, for a consideration of Rs 8.14 crore. The two companies were subsequently merged with LAC. After this, LAC's product range included engine components such as crankshafts, connecting rods and automotive gears and shafts, and plastic and rubber moulded components, and airbrake hoses. It is not clear if the engine components division of LAC would be absorbed into TVS Motor Company. However, the question of merging LAC with TVS Motor has arisen a number of times in the past — like, for instance, in the last AGM of TVS Motor Company. The TVS group has always said that such a merger could be thought of, but there was no urgency in doing so. On the last balance sheet date (March 31, 2002), the promoters and the public had stakes of 66.07 per cent and 17.73 per cent respectively, in the Rs 13.50 crore paid-up equity of LAC. In 2001-02, the company achieved a turnover of Rs 95.27 crore and a net profit of Rs 10.98 crore.
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