Grasim Industries Ltd., a flagship Company of the Aditya Birla Group, today announced the hiving off of its Sponge Iron Business by way of a slump sale for a purchase consideration of Rs.1,030 crores. The transaction was approved by the Board of Directors of Grasim at its meeting held today.

Under a court approved Scheme of Arrangement, Grasim would transfer its Vikram Ispat undertaking (Sponge Iron Business) into a new special purpose vehicle (SPV), to be formed as a subsidiary company of Grasim for this purpose, which would be funded by Welspun Power and Steel Limited (“Welspun”), through equity investment and induction of debt to acquire the SPV and Sponge Iron Business. The SPV will use the funds so inducted by Welspun to make the payment of consideration to Grasim.

The transaction is expected to be completed within the next 6 months.

The Sponge Iron Business is run under the name of Vikram Ispat. Commissioned in 1993, Vikram Ispat operates as a division of Grasim. The plant is situated in the Raigad district of Maharashtra. Vikram Ispat generated a sales turnover of Rs.950 crores during the financial year ended 31st March, 2008.

Welspun is a closely held unlisted company having its registered office in Gujarat. It manufactures sponge iron at its plant situated at Anjar, Gujarat.

Sourced From: Aditya Birla Management Corporation Ltd

Tags: calls, daytrading, free calls, intraday, tips

Similar Posts:

• Grasim cons net profit at Rs 722cr up 29%
• UltraTech Cement’s net sales up 10%, PAT up 32%
• Grasim’s consolidated net profit at Rs 672cr
• Godawari Power gets approval for Ari Dongri Iron Ore Mines
• Monnet Ispat & Energy records net sales of Rs 380cr