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Home arrow News arrow Mergers and Acquisitions arrow Andrew Yule & Co to offload 26% equity in Phoenix Yule to Continental Conti Tech
Andrew Yule & Co to offload 26% equity in Phoenix Yule to Continental Conti Tech Print E-mail
Written by Viswanath   
Tuesday, 20 October 2009
New Delhi: The Union Cabinet has approved the offloading of 26% equity held by Andrew Yule & Company Ltd. (AYCL) in Phoenix Yule Ltd. (PYL) to M/s. Continental Conti Tech for a total consideration of Rs.62.82 crore (approx) including an additional compensation of Rs.3.69 crore.

A Share Purchase Agreement would be signed between AYCL, Phoenix BV and Phoenix Yule Limited and the transfer of shares will take place immediately after the fund of Rs.62.82 crore is received by AYCL.

AYCL, a PSU under the aegis of DHI , will pay back Rs.62.82 crore received from Phoenix BV to the government against the interest free loan of Rs.87.06 crore which was extended to AYCL in March, 2008 as a part of the restructuring proposal.

The government approved the valuation of 11,943,074 shares of M/s. Phoenix Yule Ltd at the rate of Rs.49.50 per share.

Phoenix Yule Ltd, one of the largest manufacturers of conveyer belts in India, is a Joint Venture Company of Phoenix Aktiengesellschaft (AG) Germany (holding 74% equity) and Andrew Yule & Company Ltd. (AYCL), Kolkata a Central Public Sector Undertaking under the aegis of Department of Heavy Industry (DHI) (holding 26% equity). In early 2007 Phoenix Aktiengesellschaft (AG) merged with M/s. Conti Tech AG, a subsidiary of M/s. Continental AG.

Andrew Yule is engaged in manufacture of industrial fans, tea processing machinery, industrial pollution control equipment, system and allied products. The Belting Division of AYCL was spun off in 1998 and a joint venture firm with PHX having 74% equity and AYCL 26% equity was formed. AYCL received Rs.33.99 crore as purchase consideration for 74% of the Firm Value.

AYCL employs about 15,567 people and revival of the Company has helped protect the jobs.

An Inter Ministerial Group (IMG) headed by Additional Secretary & Financial Advisor, DHI was constituted to initiate the disinvestment process of AYCL’s entire stake in PYL and to recommend the valuation of share price of PYL as per the terms laid down in JVA signed between AYCL and PHX.

Last Updated ( Tuesday, 20 October 2009 )
 
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