The M.P. Birla Group's flagship company Birla Corporation Ltd, said on Tuesday, that it, along with two group companies, plans to acquire the entire shareholding of Swedish fibre-optic cables maker Ericsson Network Technologies in Birla Ericsson Optical Ltd.
Birla Ericsson Optical (BEOL) is a joint-venture of Vindhya Telelinks (VTL), Universal Cables (UCL) and Ericsson Network Technologies (ENT). The Swedish company, as an overseas promoter, holds 27.5 per cent stake in BEOL, while VTL and UCL are the Indian promoters, and presently hold 66.35 per cent of the subscribed and fully paid-up equity share capital of BOEL.
"Universal Cables Limited and Vindhya Telelinks Limited have intimated the company that they have executed a share purchase agreement (SPA) with Ericsson Network Technologies for the acquisition of entire shareholding of ENT in the company i.e. 82,50,000 fully paid up equity shares of Rs 10 each (comprising 27.5 per cent of total shareholding of the company) by the Indian ventures and/or other promoters/promoter group persons/entities of BEOL as designated by the Indian venturers," BEOL said in a filing to Bombay Stock Exchange on Tuesday.
Incorporated in 1992 under the MP Birla Group of Industries, BEOL is a leading producer and designer of fibre optic cables in the country. The company's gross revenue and net profit were Rs 273.14 crore and Rs 8.48 crore, respectively for the last fiscal.
"After such transfer, ENT shall cease to be a promoter/shareholder/technical collaborator of the company," the company said.
ENT expressed its intention to dissolve the joint venture agreement and accordingly the share acquisition move was taken by the M.P. Birla Group, whose Birla Corp's chairman Harsh V. Lodha is also the chairman of BEOL.
In a separate filing to the stock exchanges, Birla Corp said in the meeting held on Tuesday its board of directors approved the proposal for acquisition of a part of equity shares of BEOL in accordance with the terms and conditions of the share purchase agreement.
After the proposed acquisition, its equity shareholding in BEOL as a part of the promoter group will increase from the current 3.13 per cent to 17.96 per cent.
For the Birla Corp, the cost of acquiring the additional equity shares in the company would be approximately Rs 12.46 crore.
--IANS
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