Dcl Poly To Cut Paid-Up Capital By 50%

DCL Polyesters Ltd, the polyester filament yarn (PFY) manufacturing company acquired by Reliance last year, has proposed to write off the existing Rs 64.69 crore paid-up capital by 50 per cent to Rs 32.35 crore. This was part of the financial restructuring package approved by the financial institutions.

As per the proposal, existing shareholders of the company will get one new equity share of Rs 10 in lieu of the two equity shares held at present. The company also proposed to issue 6.24 crore equity shares of Rs 10 each to Synergy Synthetics Ltd, a Reliance group company, which along with its associates is already holding 30.26 per cent stake in DCL Polyesters.

 

The proposal also envisages to convert a part of the outstanding loans into equity shares, to the extent of Rs 49.43 crore. A meeting of the shareholders is scheduled for November 7, 2001, as per the directions of the Andhra Pradesh High court for the approval of the proposed restructuring scheme.

The original promoters of DCL Polyesters, the Rajus of Hyderabad, divested their 24.46 per cent holding in the company to Synergy Synthetics at Rs 6 a share of a face value of Rs 10 in May 2000. Subsequently, Synergy Synthetics came out with a public offer and acquired another 5.80 per cent stake.

After the implementation of the restructuring package, the holding of Reliance group in DCL Polyesters will go up to 50.09 per cent, while 36.73 per cent will be held by the institutions.

Public holding will come down to 13.19 per cent from the current level of 58.60 per cent. The paid-up capital will be increased to Rs 144.20 crore.

DCL Polyesters suffered a loss of Rs 48.69 crore on a turnover of Rs 304 crore for the fiscal 2000-01. According to the new management of the company, the Reliance group, the financial restructuring will help revival of the company in the coming years.