Mumbai, Feb. 17: Spentex Industries Ltd, a cotton yarn manufacturing company, is acquiring Indo Rama Textiles Ltd from the Lohias.
Spentex has scooped up more than 60 per cent equity in Indo Rama (IRTL) from promoters at a price of Rs 84.13 per share. It will subsequently make an open offer to the other shareholders of the company.
The shares were transacted largely on the stock exchanges where block deals were struck between Lohias and Spentex.
Both .P. Lohia and Urmila Lohia held 21.38 per cent and 5.57 per cent, respectively, in IRTL. Other promoters holding a 34.71 per cent stake in the company, the total promoters’ stake was put at 63.58 per cent.
.P. Lohia first sold more than 36.73 lakh shares aggregating to 11.78 per cent of the company’s paid-up equity capital and Urmila offloaded more than 8.62 lakh shares, or 2.77 per cent stake, in the open market.
However, Spentex later told stock exchanges that it would buy up to 50 per cent of IRTL’s equity in addition to the 14.99 per cent that it has bought from the Lohias and others.
The total value of the deal, including the open offer, is estimated to be around Rs 200 crore.
IRTL is engaged in the spinning of synthetic blended yarns with two plants at Pithampur in Indore and Butibori in Nagpur.
Spentex manufactures combed cotton yarn and its unit is located at Baramati in Maharashtra.
According to Spentex, the acquisition will catapult it to one of the top yarn manufacturing companies in the country. The buyout is also expected to synergise with its current product portfolio.
For Lohias, the selloff will help them concentrate on their other business, Indo Rama Synthetics Ltd, which manufactures polyester yarn, sources said.
IRTL posted a net profit of Rs 3.35 crore during the third quarter ended December 31, 2005, up from Rs 3.18 crore in the corresponding previous quarter.
Net turnover during the period was, however, lower at Rs 93.39 crore against Rs 105.2 crore in the year-ago period.
It produces close to 40,000 tonnes of yarns in blends, including polyester/cotton, polyester/viscose.
The company also exports to more than 60 countries in Europe, South Asia, Africa, West Asia and Latin America.
