Pawan Ruia plans Rs 600cr Dunlop revival

Dunlop India today said the company has submitted a Rs 600 crore turnaround package to the Board of Industrial and Financial Reconstruction (BIFR).

The company has already submitted the revival package to BIFR a month ago, P K Ruia, chairman of Dunlop India, said after the annual general meeting here.

Detailing the components of the revival package, Ruia said Rs 200 crore would be working capital, Rs 200 crore for capex and refurbishment and Rs 150 crore for repayment of creditors. The Rs 600 crore will be part of Rs 170 crore, which has already been spent by the company.

State Bank of India is the operating agency and the company expects approval of the package shortly.

"We aim to clean up the balance sheet by March 2007. To achieve this either we will go for a comprehensive restructuring of capital or combination with the BIFR package," Ruia said.

"We plan to infuse some Rs 20-25 crore as promoters contribution and then we may write-off capital against the accumulated loss. Rights issue is also not been ruled out," he said.

Promoters would announce the open offer for Dunlop India and Falcon Tyres in mid-January. The open offer price for Dunlop India would be Rs 10 and Rs 148 for Falcon Tyres in addition interest for the delay.

Dunlop's present equity base is Rs 45 crore and the accumulated loss is Rs 410 crore.

Write-off against capital was done by group company Jessop and Co.