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C K Birla Group firm Orient Paper and Industries Limited (OPIL) today said that its board has approved the demerger of its consumer electric division into a new entity -- Orient Electric.
"The board of directors of the company has decided to demerge the consumer electric business of the company by transferring the same on a going concern basis to a newly formed wholly-owned subsidiary namely 'Orient Electric Ltd," OPIL informed the BSE.
The scheme would be applicable from March 1, 2017, subject to regulatory approvals.
The move would "enable a dedicated management focus and accelerate the growth of the consumer electric business unlocking significant value for the shareholders of the company and access to varied sources of funds for the rapid growth of both business".
It further said that there will be no change in the share holding pattern of the company.
The demerged company will issue one share of Re 1 each for every share held in OPIL, it added.
Orient Electric would manufacture and distribute consumer appliances such as fans, lighting products, home appliances and switchgears.
"The turnover of the demerged business division is Rs 1,301.83 crore. Percentage of the turnover of the demerged division to the total turnover of the company is 71.51 per cent," it added.
OPIL has manufacturing capacity of about 85,000 tonnes of paper.