Asahi India Safety Glass Ltd will make an open offer for the 25 per cent public shareholding in Float Glass Ltd at Rs 11 per share. The move follows Asahi's buyout of the 75 per cent stake held by Asahi Glass Company Ltd of Japan in Float Glass.
The Asahi India board today gave its assent to the acquisition of shares held by the Japanese company. The offer will be lead managed by Enam Securities.
If the open offer is successful, Float Glass will become a wholly owned subsidiary of Asahi India. According to sources, there is no proposal at the moment to merge the two companies, though the proposal may come up for consideration later. After the transaction, both the companies will be brought under the single management of Asahi India.
Asahi has picked up the Japanese company' stake for nil consideration. Instead, it will be responsible for the Rs 453 crore debt on Float Glass' books. A large chunk of it was from Asahi Glass of Japan. Now, the Japanese company has decided to write that debt off which will bring the debt in Float Glass' books down to around Rs 192 crore. This will now become the responsibility of Asahi India.
The open offer is a part of an exercise by Asahi Glass of Japan to consolidate its shareholding in India. Apart from Float Glass, it owns a 24 per cent stake in Asahi India, the Labroo family owns another 24 per cent, while Maruti Udyog Ltd owns 12 per cent and the public 40 per cent.
The transaction will make the two companies the largest players in the Indian glass industry.
Speaking on the occasion, Asahi Glass president Shinya Ishizu said the transaction was in keeping with the need to capitalise on the synergies available in the complete value chain of the glass industry in India.
Asahi India managing director Sanjay Labroo said: "The deal represents an excellent opportunity for the new entity to add value to its customers, employees and shareholders. We will now have a product line that will cater to all segments of the glass industry."
The plant of the Rs 200 crore Float Glass is based at Taloja in Maharashtra. The capacity of this plant is 29.29 million square meters on a 2 mm thickness basis. The Rs 225-crore automotive safety glass manufacturer, Asahi India, has its plant at Rewari with a capacity of 1.20 million car sets.
