Amid reports that cement major UltraTech Cement has expressed interest in acquiring the cement assets of Kesoram Industries, the B K Birla Group flagship company on Monday said its board of directors, will later this week, consider possible options on repayment or retirement of some of its existing debts.
In a stock exchange filing, Kesoram said its board, in a scheduled meeting on Thursday, will also consider withdrawal of proposed demerging of the company’s wholly-owned subsidiary Cygnet Industries into a separate entity. Cygnet has rayon, transparent paper and chemical business.
Kolkata-based Kesoram, the B K Birla Group flagship, said in the scheduled meeting the board of directors of the company, inter alia, will consider the possible options on repayment/retirement of the existing non-convertible debentures.
Interestingly, replying to a clarification sought by BSE following speculations in the markets that Kumar Mangalam Birla-led UltraTech Cement, India’s largest cement maker, has evinced interest in acquiring Kesoram Industries’ cement assets, Kesoram on last Friday said the company is presently exploring fund raising avenues for repayment/retirement of its debt falling due next year.
Notably, Manjushree Khaitan-led Kesoram’s board at its meeting held in May, 2022 had approved a scheme of arrangement between the company and Cygnet Industries, its wholly-owned subsidiary, with the appointed date being 1 April, 2022. The proposed scheme involved demerger of the subsidiary company from the group, and was subject to the required statutory and regulatory approvals.
When contacted, P Radhakrishnan, the whole time director and CEO of Kesoram, declined to comment on the scheduled meeting on Thursday.
At the end of the last financial year, the company’s net loss on a consolidated basis stood at ₹194.27 crore. The company was planning to reduce its debt to around ₹1,200 crore in the next few years from the current level of Rs 1,700 crore.
Kesoram currently has a cement production capacity of around 10 million tonnes, while the clinker capacity stands at around 6 million tonnes. Out of 7 million tonne production in the last financial year, 3.8 million tonne was blended.