GMR Industries Ltd to de-merge ferro alloys division

GMR Industries Ltd has announced that the Board of Directors of the Company at its meeting held on August 12, 2006, has taken the following decisions:

1. To de-merge the Ferro Alloys Division to a Separate Company "GMR Ferro Alloys & Industries Ltd", subject to approvals from Shareholders, Stock Exchanges and High Court of Andhra Pradesh and other authorities as may be required. The Board has approved the adoption of the Valuation Report submitted by M/s. Deloitte Haskins and Sells (DHS) which forms the basis for the issue of shares to the members of the demerged Company (GMR Ferro Alloys & Industries Ltd) in exchange for the transfer of the demerged undertaking under the Scheme of Arrangement. As per the said Scheme of Arrangement every equity shareholder holding 100 equity shares in the Company would be getting 38 equity shares in GMR Ferro Alloys & Industries Ltd and 62 new equity shares from the Company in cancellation of their existing 100 equity shares in the Company. Further, every preference shareholder holding 100 preference shares in the Company would be getting 38 preference shares in GMR Ferro Alloys & Industries Ltd and 62 new preference shares from the Company in cancellation of their existing 100 preference shares in the Company. All the assets and liabilities pertaining to Ferro Division would be transferred to the new Company at book values and in accordance with Section 2(19AA) of the Income Tax 1961 and Sections 391 to 394 of the Companies Act 1956. The appointed date of demerger is April 01, 2006.

2. To merge Bharat Sugar Mills Ltd (BSML) with the Company, in accordance with the provisions of Section 391 to 394 of the Companies Act 1956 and other statutes and subject to approvals from Shareholders, Stock Exchanges and High Court of Andhra Pradesh and other authorities as may be required. BSML, currently, is a subsidiary of the Company, which is implementing a project for construction of an Integrated Sugar Complex with 3500 Tonnes Crushing per Day (TCD) expandable to 5000 TCD, Cogeneration Power Plant with 24 MW and 45 KLD of Distillery Plant at a cost of Rs 2740 million. The appointed date of merger is April 01, 2006.

Source : Equity Bulls

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