Liquor major Shaw Wallace & Company saw significant changes during 1995-96 in the pattern of its subsidiary companies with three of its arms no longer remaining as subsidiaries, and two new companies being brought under the SWC stable.
According to the annual report for 1995-96, Dunlop Industrial Finance and Showa Investments were incorporated as subsidiaries while Jayanthi Detergents, Jumbo Telecom and Sea Tech Services ceased to remain as subsidiaries. Jumbo Telecom had ceased to be a subsidiary with effect from November 10, 1995, followed by another subsidiary Jayanthi Detergents with effect from April 10, 1996.
Sea Tech Services also ceased to be a subsidiary during 1995-96. Dunlop Industrial Finance and Showa Investments became subsidiaries of Shaw Wallace with effect from March 20 and June 5, 1996, respectively. Meanwhile, the company has secured the approval of the Registrars of Companies for the extension of the financial year of its manufacturing subsidiaries Pampasar Distillery and Central Distillery & Breweries to March 31, 1997. This will enable the accounting years of the two subsidiaries, covering a period of 18 months, to fall in line with that of other manufacturing subsidiaries.
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The accounting years of non-manufacturing subsidiaries have been changed from October/September to July/June so as to bring the financial year 1995-96 to close on June 30, 1996; thereby completing a period of nine months to fall in line and in conformity with that of the holding company.
On the basis of the revival plan evolved by McKinsey & Co, Shaw Wallace & Company is presently implementing a process of organisational restructuring through mergers into the parent company. (More stories on Page 10)
The strategy involves financial rehabilitation, organisational restructuring and strategic direction.
With the implementation of the approved financial plan including proposed sale of some of the non-core businesses and non-productive assets coupled with current operational surpluses, the company expects to get over its problems and regain its earlier sound financial position.
During the year under review, Henkel Spic has reportedly emerged as the highest bidder for the company's consumer's products division (CPD). According to the chairman's speech, the decision to sell of the CPD was taken as an alternative strategic action to overcome stagnation. The stagnation phase in the Indian consumer products industry has been brought about by the entry of several multinational players leading to a crowded market place, the chairman's speech said.
At the annual general meeting scheduled for August 8, the company will seek shareholders approval for the rehabilitation-cum-amalgamation scheme of Doburg Larger Breweries Ltd (DLBL) with SWC, which has already been sanctioned by the Board for Industrial and Financial Reconstruction (BIFR).
To give effect to the amalgamation scheme, the company proposes to issue a maximum of 5000 equity shares of Rs 10 each of the company at par to the equity shareholders of the DLBL in the proportion of one fully paid-up equity share for every sixty equity shares of the face value of Rs 10 each, fully paid-up held in DLBL.