Skf Bearings Plans Rights To Garner Rs 88 Crore

SKF Bearings India plans to float a rights issue to raise Rs 88 crore from the market to fund its expansion and retire high-cost loans.

As part of the issue, SKF will issue equity shares aggregating Rs 50 crore and the balance sum will be in the form of non-convertible debentures with detachable warrants, convertible into one equity share each.

Also, the existing equity share with a face value of Rs 100 each will be sub-divided into 10 shares of Rs 10 each, the company said in a release.

In the release, Torsten Nordgren, managing director, SKF Bearings India said, "SKF India has, since the past three years, been involved in an extensive restructuring to improve its long-term competitiveness."

"The rights issue is an integral part of the company's comprehensive restructuring and will allow it to proceed with its investment plans in India, and at the same time allow us to reduce our borrowings and thereby our financial cost. This, in turn, will help improve our financial bottomline," he said.

As part of ongoing revamp, the company has already taken initiatives such as the Pune 2000 programme (for upgrading its plant at Pune), introduction of new, higher value-added products, services and production channels, implementation of advanced IT systems and supply chain solutions for improving its customer service. The company has also reduced its workforce by 30 per cent thus far through voluntary retirement schemes.