BILT announces PE investments in subsidiary

* Government of Singapore Investment Corporation Pte Ltd ("GIC")'s private equity investment arm and JP Morgan to invest USD 175 mn in Ballarpur Paper Holdings B.V. for an equity stake of 21% (approx)

* Equity value of Ballarpur Paper Holdings B.V. at USD 825 mn

Ballarpur Industries Ltd. (BILT), India's leading paper manufacturer and flagship of the USD 3 billion Avantha Group, today announced approval of equity investments of USD 175 million by two major firms:

* GIC Special Investments Pte Ltd. (a wholly owned subsidiary of GIC), through its nominated investment vehicle, and

* JP Morgan's Principal Investment Management group in Ballarpur Paper Holdings B.V. (BPH)

This will entitle them to an approximate 21% equity stake. BPH is a wholly owned step down subsidiary of BILT in the Netherlands.

BILT had created BPH as a special purpose vehicle for the acquisition of Sabah Forest Industries Sdn Bhd (SFI) the largest integrated pulp and paper mill in Malaysia. BPH owns 97.8% of the capital in SFI and the balance 2.2% is held by the Government of Sabah.

Pursuant to the financial restructuring in terms of the approved Scheme of Arrangement and Reorganization, the three undertakings of BILT at Bhigwan, Ballarpur and Kamalapuram were transferred to its wholly owned subsidiary in India, BILT Graphic Paper Products Limited (BGPPL) through a slump exchange effective 1st July, 2007 for a lump sum value of Rs.1,950 crore. BILT will transfer its investments in BGPPL to BPH.

BPH will utilize the funds to be received from the private equity investment firms to part finance consideration payable to BILT for sale of its investments in BGPPL.

About BILT

Ballarpur Industries Limited (BILT) is India's largest manufacturer of Writing and Printing Paper with 21% of the W&P market and approximately 53% of the coated paper market. BILT has six paper mills in the states of Orissa (Unit Sewa), Haryana (Unit Shreegopal), Maharashtra (Unit Ballarpur, Bhigwan and Ashti) and Andhra Pradesh (Kamalapuram) together with a capacity of 480,000 tpa and a pulp mill of capacity 100,000 tpa manufacturing rayon grade pulp, in the state of Andhra Pradesh (Unit Kamlapuram). All of the Units (except Ashti) possess captive power generation capacities and, with the exception of Bhigwan & Ashti, also possess captive pulp making capacity. Together, these Units give the company geographic coverage over most of the Indian market.

About Avantha

Avantha Group is one of India's leading business conglomerates. Its successful entities include BILT, Crompton Greaves, Solaris Chemtech, Global Green, Biltech Building Elements, BILT Power and Salient Business Solutions. International subsidiaries include Pauwels, SFI, Intergarden, Ganz and Microsol. The over US$ 3 bn Avantha Group is on the path for a turnover of US$ 10 bn and a market capitalization of US$ 25 bn by 2013. The Group has business interests in diverse areas including power generation and distribution, power transmission and distribution equipment and services; paper and pulp; food processing; farm forestry; chemicals; infrastructure, IT and ITES. Led by Mr. Gautam Thapar, Avantha demonstrates strong leadership globally and emerges as a focused corporate, leveraging its knowledge, leadership and operations, adding lasting value for its stakeholders and investors.