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J&N revival hopes die young

Calcutta, Oct. 1: Hopes of Jenson & Nicholson’s revival died young with Judis Moneta Financial Services — the Singapore-based investment bank — deciding against buying out the promoters’ 50 per cent stake following differences with S. P. Sinha, chairman of the beleaguered paints company.

Judis Moneta had previously reached an agreement with Sinha — the promoter of Jenson — to take over his 50 per cent stake for an aggregate consideration of Rs 1 crore.

But the investment bank now says the deal will fall through as Sinha refuses to give up his entire stake and management control till Judis Moneta has invested in Jenson’s operations.

“Sinha has offered to divest 12-14 per cent of the company’s shares upfront. The balance, he says, he would transfer after we have infused funds into the company. This is completely unacceptable to us. Sinha must step down as chairman and transfer his entire stake in the company.

“Unless we obtain a free hold of the management and the entire 50 per cent stake that Sinha owns, we are not going to invest in Jenson,” said a spokesperson for Judis Moneta.

Sinha could not be reached at his office or home in Patna. Malay Saha, the company’s spokesperson and head of finance, who operates out of Mumbai, could not be contacted either despite several attempts. He did not answer calls on his mobile phone.

Jenson is indebted to the tune of Rs 250 crore. Karan Judge, the managing director of Judis Moneta, had previously said he hoped to settle the company’s dues for a little over Rs 100 crore. “The acquisition will cost us around Rs 150 crore in all, including repayment of debts,” he had said.

Jenson had appointed Judis Moneta a couple of months ago to scout for a strategic investor and to broker a settlement with its lenders.

The promoters of Jenson had previously approached competitors like Shalimar Paints and Berger for investment in the company, but neither found the proposal attractive. Berger is understood to have even conducted the due diligence exercise, but decided against investing in the company.

Industry observers say Jenson is now likely to seek protection from lenders under the sick companies act, or could eventually be taken over by the banks and financial institutions that lend to it. “It’s bad news for its employees. Jenson is facing closure and none of the paints companies is going to bail it out,” said an industry expert.

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