Ricoh To Up Stake In Rpg Ricoh To 55%

Ricoh Co Ltd of Japan is raising its stake in its office automation products joint venture, RPG Ricoh, from 26 to 55 per cent. The Japanese firm also intends to buy out the RPG groups stake, thereby further raising its holding to 76 per cent.

A company official confirmed that the RPG Ricoh board passed a resolution yesterday to allot almost 43 lakh shares to Ricoh, giving it a majority holding of 54.83 per cent in RPG Ricohs expanded equity of Rs 10.76 crore. The current share capital is Rs 6.46 crore.

The RPG group is selling its stake in RPG Ricoh in favour of its joint venture partner, Ricoh Co. After the expansion of RPG Ricohs equity base, RPGs holding in the company will come down from 34 to 20.4 per cent. Following the preferential allotment to Ricoh, the public holding will be reduced to 24 per cent.

 

According to a company release, As a part of its restructuring, the RPG group has decided to focus on its core business lines one of which is the service business in the communications sector.

The RPG Ricoh board met in Mumbai yesterday to consider a preferential offer to existing shareholders. The RPG group announced its intention to divest its holding in the joint venture company at the meeting. We have informed the stock exchanges and sent a notice to the Securities and Exchanges Board of India regarding our intention to sell our stake. However, other details like the price are still being worked out, said a group spokesperson.

Following this decision, RPG Ricoh chairman Harsh Goenka and two other RPG representatives, V S Krishnan and Paras Chaudhary, are expected to resign from the companys board. Ricoh has three representatives on the board, M Takeiri, K Inoue and Y Mizutani. Besides, H Okashita and S Ikegami are the alternate directors.

The Rs 80 crore RPG Ricoh manufactures and markets photocopiers, fax machines and other specialised products. With a manufacturing facility at Gandhinagar in Gujarat, the company has over 100 dealers and business associates and a field force of over 400. The company plans to launch new products and line extensions as part of a strategy to double its turnover by the year 2000.

M Takeiri, who is also on the board of Ricoh in Japan, said The progress made by the company to date is most commendable and is largely because of the very positive management support from the RPG group. Also, the future potential of the market is immense. It is also very competitive. Customers can now look forward to some of the latest products from our stable in the years ahead.

V S Krishnan, board member and president of RPG group (strategic planning), said Its a win-win situation for both the partners. It gives Ricoh the opportunity to drive the office automation industry in India, and permits RPG to concentrate on building its core business.