Deutsche Bank to pick up equity stake in BPL

Deutsche Bank is set to pick up stake in Bangalore-based BPL Limited. BPL’s board approved on Friday a proposal to make preferential issue of 24,25,500 equity shares and/or convertible securities to Deutsche Bank AG (DB) and/or its nominees and affiliates in terms of applicable SEBI guidelines and is expected to be completed after the company’s Extra-Ordinary General Meeting.

The board of directors has also approved a Qualified Institutional Placement of securities for which, the board has authorised the chairman and managing director to decide the size and timing of the issue.

It is intended that the proceeds of this issue would be used to fund long term working capital requirement for the company’s healthcare management solutions business and other general corporate purposes.

BPL’s chairman and managing director, Ajit G Nambiar, said that Deutsche Bank has been involved in the company’s restructuring and that the equity investment was a vote of confidence in the company and the promoters. “This speaks highly of how we are perceived as a brand and also of the direction that we have set ourselves going ahead. We welcome Deutsche Bank aboard. We shall announce our plans shortly.”

This investment from Deutsche Group will be a much needed helpline for the cash strapped BPL which is going through the throes of a painful restructuring after having run up a debt of Rs 1,400 crore and dwindling market share in the consumer appliances business. The joint venture with Sanyo is also set to be wound up which was focusing on colour televisions.

The BPL Healthcare Management Solutions Division has been associated with Indian healthcare sector for over three decades and manufactures a range medical equipments.

According to the company spokesperson, the company is also in the process of implementing its 600mw Ramagundam Thermal Power Project and is actively considering a few more projects.