Float Glass Raises Ecbs To Refinance Domestic Loans

Float Glass India Ltd (FGI) has refinanced its high cost domestic term loans by raising external commercial borrowings with the help of guarantee from Asahi of Japan which has a 49 per cent stake in the company.

The company also proposes to convert soft loans to the tune of Rs 20 crore provided by the promoters into 10 year 10 per cent cumulative redeemable preference shares.

The financial restructuring by Float Glass follows the heavy losses made by the company at the end of the first half of the financial year and the company had to be referred to Board for Industrial and Financial Reconstruction as a potentially sick company.

To shore up its net worth Float Glass had also gone in for a preference share issue in September last year.

Float Glass had posted a loss of Rs 29 crore at the end of the first half and by the losses at for the financial year is expected to be in the region of Rs 50 crore.

Company officials said that they have worked out a revival plan and central to this is reducing the cost of funds.

The company has repaid the high cost term loans it had contracted from Industrial Development Bank of India and Hongkong Bank.

Asahi has a 49 per cent stake in Float Glass India, with Tata Engineering and Locomotive Company Ltd (Telco) holding 9 per cent,

ACC holding 13 per cent and Tata Exports holding 3 per cent. The remaining 25 per cent is held by the public.

There has also been a pick up in exports by the company.

While exports had slumped in the first half on account of poor realisations, company officials point out that there has been marginal growth in the second half especially from the African markets and Greece.

The turnover of the company is expected to go up by around 10 per cent over the last years level of Rs 136 crore.