Mysore Cements announces implementation of joint venture with Heidelbergcements Group

Mysore Cements Ltd has announces implementation of the joint venture relationship created on July 18, 2006 between the S K Birla Group and HeidelbergCements Group. In accordance with approval accorded by the shareholders in the Extra Ordinary General Meeting held on August 16, 2006 the Board of the Company has on August 23, 2006 allotted 6,65,00,000 Equity Shares of Rs 10/- each at Rs 54/- per share (inclusive of premium Rs 44/- per shares) on a preferential basis to Cementrum I B.V. (a subsidiary of HeidelbergCement).

The issue price is about 23% over the minimum issue price under relevant SEBI rules and about 4.5% above the BSE closing price of August 22, 2006. Cementrum I B.V. has already announced its open offer to shareholders of the Company at a price of Rs 58/- per share, to which the Board has accorded its no-objection certificate earlier. The Company will become subsidiary of HeidelbergCement Group after the acquisition of a part of the shareholding of the S K Birla Group (post completion of the open offer in accordance with applicable law).

This issue has enabled the Company to raise Rs 3591 million as long term capital resources and has as on date restored its net worth to a significant positive level. This makes it capable of addressing its debt and further strengthening its operations. The Equity Capital now stands at Rs 1580.10 million.

Sri. H K Kejriwal, Dr. V K Gangwal, Sri. A S Shankare Gowda and Sri. Padam K Khaitan have resigned on August 23, 2006 as Directors and the Board has deeply appreciated their association and the services rendered during their respective tenures. Sri. N L Hamirwasia, Managing Director and Sri. N Lodha, Executive Director resigned from their respective positions and the Board greatly appreciated services rendered by them throughout their employment with the Company.

Sri. S K Birla continues to be Chairman of the Board and Sri. Sidharth Birla continues as a Director. Dr. B Seheifele (Chairman of the Managing Board of HeidelbergCement), Ir. Daniel Gauthier (Member of the Managing Board of HeidelbergCement), Dr. Lorenz Nager (Member of the Managing Board of HeidelbergCement) and Mr. Ashish Guha (Country Head, India for HeidelbergCement) have been appointed as Directors of the Company on August 23, 2006.

Mr. Ashish Guha on August 23, 2006 has also been appointed as Managing Director of the Company (subject to necessary approvals) Mr. Brad Taylor has been appointed as the CFO.

Ambit Corporate Finance was the Financial Advisor and J. Sugar Associates were the legal Advisors to HeidelbergCement. SMIFS Capital Markets was the financial advisors and Khaitan & Co were the legal advisors to the Company and the S K Birla Group.

Source : Equity Bulls

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