Arvind Mills, WL Ross in OCM takeover race

Arvind Mills and WL Ross, one of the world's largest stressed asset management funds, have emerged the frontrunners for aquiring OCM India, which was recently spun off into a separate entity from the SK Birla group's textiles company, Birla VXL.

Sources at Birla Buildings, the headquarters of the group in Kolkata, said five companies "" three foreign institutions and two domestic textiles manufacturers "" responded to the Asset Construction Company (India) Ltd (Arcil), which had been looking for a buyer for OCM India.

Two other foreign institutions and another domestic textiles maker are also in the fray. But sources close to the developments said Arvind and WL Ross appeared to be the most serious bidders. However, it would take a couple of months to close the deal, they added.

Arvind Mills Chairman Arvind Lalbhai could not be reached for comment. Birla sources said the company had completed restructuring of its debt. As part of the restructuring, Birla VXL will continue with the Digjam unit while it has spun off the OCM unit as a separate company.

Arcil is now the majority stakeholder in Birla VXL following the restructuring. However, the Birla group will continue to have management control. The group has decided to chip in around Rs 20 crore through a rights issue, which will scale up its holdings.

Sources in Arcil said the institution had set a target of Rs 180 crore from the sale of OCM India and Rs 70 crore from the sale of shares of the company in various listed entities.

OCM, known for its all-wool worsted and wool-blended worsted suitings, was bought out by the Birlas in 1972. Its production facilities were converted to manufacturing worsted fabric from carpets and carpet yarn.