The stake of French power major Alstom in its India flagship, Alstom Power India Ltd, will go up from 50.99 per cent to 67 per cent once its three other ventures in the country -- Alstom Transport, Alstom Systems and Alstom Power Boiler -- are merged into it.
"After the merger, the company is proposed to be renamed as Alstom Projects India Ltd," Alstom country president (India) Krishna Pillai said.
Alstom's has a 100 per cent stake in Alstom Transport Ltd. Its holding in Alstom Systems is 97 per cent with the Uttar Pradesh government holding a three per cent stake. The French power major's stake in Alstom Power Boilers is 76.1 per cent, with the central government holding 15 per cent, financial institutions five per cent, and the original promoters of the company around four per cent.
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The swap ratio worked out for the merger is as follows: 50 shares of Alstom Power for every 85 shares of Alstom Transport, 78 shares of Altom Power for every 85 shares of Alstom Systems and 22 Alstom Power shares for 85 shares of Alstom Power Boilers. All the Alstom Power shares given to shareholders of other companies will be new shares. The valuation for the transaction was carried out by AF Ferguson.
According to Pillai, Alstom is studying the possibility of further consolidating its business (currently spread over 16 companies), two of which -- Alstom Power and Alstom India -- are listed, while the other 14 are closely held. "Ideally, there should be only one entity in India but I don't think that is possible," Pillai said adding: "In August last year, we though that the whole exercise would be over during the current financial year. I think we will make substantial progress during the year." Pillai said that the Alstom India, the other listed group company, is also being considered for amalgamation.