A V Birla Group Enters Race For Cmc Stake

The race for CMC is hotting up with the A V Birla group joining the fray to buy part of the government stake in the state-owned company. The move follows the group's new-found thrust in the infotech sector after its recent acquisition of PSI Data Systems.

Senior A V Birla group officials said: "We are interested in CMC. We have already submitted an expression of interest (EoI) and are evaluating our options at present." The global advisors has not yet called for financial bids.

Several other leading business houses are in the race for CMC, according sources close to the divestment process. While the Tata group has put in an EoI through Tata Consultancy, the Reliance group and Wipro are also reportedly in the race.

Even the US-based hardware giant Hewlett-Packard has evinced interest in CMC. The government has announced it will divest 57.3 per cent of its 80 per cent stake in the company.

However, analysts expect the disinvestment to gather more wind in the coming months, as the profit-making company would support the growth plans in the IT sector of all the contestants, especially the Birlas and the Reliance group, who are relatively late entrants into the sector.

CMC, the largest PSU in the fast-growing Indian infotech industry, recorded net profit of Rs 24.46 crore in 2000-01 on sales of Rs 534 crore.

The CMC scrip closed 1.78 per cent higher on Monday on the Bombay Stock Exchange, while the benchmark index ended up 0.39 percent.