Ess Dee, MALCO take over Vedanta Indian Foil

Written by:
Subscribe to Oneindia News

Mumbai, Nov 19 (UNI) Debt ridden India Foils Limited (IFL), a unit of Vedanta Group, has been acquired by Kolkata-based pharma foil packaging company Ess Dee Aluminium and Chennai-based Madras Aluminium company (MALCO) in a deal worth Rs 261 crore in equity and preference shares under Board of Industries&Financial Reconstruction (BIFR) scheme.

Under the rehabilitation scheme, Ess Dee and MALCO will takeover West Bengal-based IFL, which was declared sick in 2006. With Ess Dee contributing Rs 110-120 crore, and taking over 85-90 per cent of the equity. MALCO and public will share the remainder of debts and shares.

Making the official announcement here today, Ess Dee Aluminium Chairman and Managing Director Sudip Dutta said the acquisition has been funded through a Rs five crore loan from Morgan Stanley and internal accurals. The deal would make Ess Dee the largest pharmaceutical foil manufacturing company, with increased rolling capacity to 37,000 tonnes from 18,000 tonnes across five manufacturing units.

The increased capacity will be initiated with revamping of IFL's Kamarati, Horea and Taratala plants. Ess Dee expects IFL's 18-19,000 tonne capacity to reach 70 per cent by March '09 and 100 per cent capacity within three years. The company will also introduce a range of products, including anti-counterfeit products within six months that will cater to the domestic and foreign markets like Southeast Asia, Middle East and Bangladesh. Target companies will be pharmaceutical companies and FMCGs, including MNCs.

''We will employ a 'spoke and Hub' model of manufacturing and have no plans to change IFL's name as it is a brand leader in the market,'' Ess Dee Aluminium Director Debdeep Bhattacharya said. He said that IFL's foray in advanced packaging products and high cost of manufacturing landed it in a position of debt. Vedanta also wanted to concentrate in its core business of metal, he added.


Please Wait while comments are loading...