Crompton Greaves said that its board of directors at the annual strategic review meeting on July 16 in Belgium proposed to demerge its consumer products business unit into a separate listed company.

In a communique to the BSE, the company said said the board believed that such a demerger will create better growth opportunities for its two large but significantly different businesses - power, industrial and automation.

It also felt that this would create a more flexible capital structure for the two businesses to grow independently, allow them to pursue more ambitious strategic goals and create further value for the shareholders.

The board has also constituted a Committee of Directors to examine all relevant aspects of the process of demerger and listing and make suitable recommendations.