Shiva Cement Promoters In Bid To Exit

The promoters of Rourkela-based Shiva Cement Ltd (SCL) are planning to sell off their stake, and are in dialogue with 2-3 companies, one of which is said to be a multinational. The plant has a capacity of 0.9 million tonne.

Industry sources said Lafarge is interested in the plant as it would enable it to enhance its stronghold in eastern India. When contacted, Ravi Iyer, chief financial officer, Lafarge, declined to comment on the matter but a spokesperson for Lafarge in India said, "We would not like to comment on the issue at this point."

SCL managing director R P Gupta said, "We are in dialogue with 2-3 companies, of which one is a multi-national company with a strong presence in eastern India."

 

Asked whether it will be a majority stake sellout, Gupta said, "The company is weighing all options, and also waiting for exact terms and conditions to emerge."

A reliable industry source said, "Lafarge is conducting the due diligence exercise on the issue. They have asked SCL to submit audited financial results till March 31, 2000, which is not ready as yet."

Gupta refused to comment on this, but admitted that the results have not audited as yet. Currently, SCL produces 1.27 lakh tonne of cement per annum, but its plants are underutilised. Without adding further kilns, the plants can produce another 9.3 lakh tonne, Gupta said, adding "We are looking for a joint venture partner to generate funds for full use of our capacity."

Gupta said, SCL plans to increase capacity in two phases - in the first phase, by 3.3 lakh tonne, and in the second, by 6 lakh tonne. To finance the first phase, the company has already applied to Industrial Development Bank of India (IDBI) for a term loan of Rs 13 crore, and will launch a public issue for which preliminary work at the company's end is complete, Gupta said.

"The second phase will require Rs 50 crore for which the company intends to enter a joint venture with a bigger firm," he said.