Sundaram Clayton Ltd (SCL), part of the TVS Group, plans to demerge its non-auto business into a subsidiary. The new company will be listed, according to a senior official of the company.
Executive Director H Lakshmanam told Business Standard that in addition to a manufacturing die casting unit, the company has invested in TVS Motors and other non-auto companies like TVS Electronics and TVS Capital Funds.
“We have investment in about 18 companies. We plans to segregate the non-auto business and list the subsidiary company,” said Lakshmanam, adding, “In simple terms, two companies — one to focus on auto business and other one for the non-auto segment.”
Gopal Srinivasan, the joint managing director of Sundaram Clayton, will head the new company.
Meanwhile, the company’s announcement on the Bombay Stock Exchange stated that it had acquired the entire equity paid-up capital of Sundaram Investment Ltd (SIL).
SCL, part of the $4-billion TVS Group, is one of the leading auto components manufacturing and distribution group and a leading supplier of aluminum die castings to automotive and non-automotive sectors.
The announcement added that the board of directors, at a meeting on August 13, approved proposals that included acquisition of the entire paid-up capital of '5 lakh of SIL, demerger of non-automotive related business of the company into SIL and the merger of TVS Investments Ltd with SIL. The board also approved the merger of Anusha Investments Ltd, another wholly-owned subsidiary, with the company.
“The above proposals are subject to such regulatory approvals as required under Sections 391-394 of the Companies Act, 1956, and other ‘Securities Laws’ as defined under the Listing Agreement. On finalisation of the Composite Scheme of Arrangement to implement the above proposals, the company will file the scheme with the stock exchanges and seek their in-principle approval before filing the same with the Madras High Court,” the company said in the announcement.
