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Kesoram Industries, a B K Birla group company, on Thursday announced it had set up a three-member committee of directors to explore options to reorganise its businesses. Two directors of the committee were independent ones, the company said.
Following the announcement, the Kesoram stock closed at Rs 120 on BSE, up 8.5 per cent, on speculation the company's cement business would be acquired by UltraTech Cement, an Aditya Birla group company and India's largest cement producer, with an installed capacity of 57 million tonnes a year.
Aditya Birla group chairman Kumar Mangalam Birla is the grandson of B K Birla.
Apart from cement, Kesoram is present in the tyre and rayon segments.
When contacted, Kesoram officials declined to comment on the move to hive off the cement business. They also declined to reveal the names of the three directors on the panel to restructure the company's businesses.
A member of the Kesoram board said there was no proposal to sell the tyre business, adding the company was planning to raise Rs 1,000 crore through non-convertible debentures to strengthen its businesses. An Aditya Birla group spokesperson said reports UltraTech was acquiring Kesoram's cement business were false.
The move to realign the company's businesses comes within weeks of another B K Birla group company, Century Textiles, announcing it would make a preferential offer of shares to promoter companies of Kumar Mangalam Birla. With the allotment, the shareholding of Kumar Mangalam Birla's holding companies would rise from 40 per cent to 57 per cent. Kumar Mangalam Birla is a member of the Century board, chairing its meetings in the absence of his grandfather.
Manjushree Khaitan, B K Birla's daughter, is the Kesoram's executive vice-chairperson.
