J K Corporation today announced that the company has completed its debt and business restructuring which involves transfer of J K Paper Mills to another group company, Central Pulp Mills, and pared off 55 per cent of its debt burden of Rs 1,500 crore.
As part of the debt restructuring exercise, J K Corporation reduced its debt burden to Rs 700 crore from Rs 1,500 crore earlier through rescheduling loans and conversion of debt into equity-related instruments. The interest burden on the company has also come down without the creditors having to write off any part of their exposure in the company, a company release said here.
J K Corporation, which divested its polyester business earlier, would now focus on cement and paper businesses. The company has a cement plant at Sirohi in Rajasthan with a 2.2 million tonne per annum (tpa) capacity, and the restructuring would take up the capacity of Central Pulp Mills to 1,50,000 tpa.
"We have been a key player in cement and paper, and have been investing consistently in terms of capacity enhancement, infrastructure and market development. With the restructuring, we hope to emerge even stronger and a focused long-term player," J K Corporation chairman and managing director Hari Shankar Singhania was quoted in the release.
With the merger, Central Pulp Mills has become one of the largest paper companies in India with production units in Orissa and Gujarat, and a nationwide distribution network.
"With this consolidation, Central Pulp will be financially strong with healthy cash flows," the release said. As part of its consolidation strategy, the company would focus on the Sirohi cement plant and strengthen the 'Lakshmi Cement' brand, it said.
