You are here: Home » PTI Stories » National » News
Business Standard

Kesoram to demerge tyre division, help to pare Rs 1000cr debt

Press Trust of India  |  Kolkata 

B K Birla group company Kesoram Industries on announced of its tyre business in a major second round of in the wake of unsustainable debt of the company.

Kesoram, in a statement, said the company approved the of the tyre undertaking into a new entity, Birla Tyres Limited.

"We are open for investors but will continue to be in the business of tyres,"

Kesoram told

Two years ago, the company had sold off the Laksar tyre plant near Haridwar to JK Tyres for close to Rs 2,000 crore in a bid to control its debt of Rs 5,300 crore.

The company has been continuously paring debt which currently stands at Rs 3,500 crore, but was grappling to manage it.

The turnover of the demerged tyre division is Rs 1453 crores which is 39 per cent of the total company topline as on last fiscal. Approximately Rs 1000 crore debt will get transferred to the demerged tyre company.

Kesoram shareholders will get one share of Rs 10 each of Ltd for each share held in the company.

Offering rationale for the demerger, the Kesoram management said, "Enabling a for tyre will help focus and accelerate growth of both the tyre and businesses, unlocking significant value for Kesoram shareholders and accessing varied sources of funds for the rapid growth of both businesses."

The Proposed shall be subject to the approval by

Post demerger, Kesoram will retain business in with an installed capacity of 7.5 million tonne and rayon.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, December 04 2018. 18:40 IST