The JP Chowdhary-promoted Titagarh Industries Ltd has received the in-principle approval of its board of directors for undertaking a business restructuring. The approval was received on October 23, following a board meeting.
The essential details of the proposed restructuring plan, which is in the process of being worked out, would be placed before the board for its formal approval in due course. The company has convened another board meeting on November 2, Umesh Chowdhary, joint managing director of Titagarh Industries, told Business Standard.
The final restructuring plan would be placed before financial institutions for approval. Subsequently, the company would also seek the approval of shareholders, the Calcutta High Court and other appropriate authorities.
Titagarh has recently completed a diversification into wagon building and paper. The diversification into paper was done through the acquisition of Titagarh Paper.
The wagon building business was more of a forward integration of the company's existing wagon components business. Last year, the company had reportedly appointed a Finnish consultant to prepare a techno economic feasibility report on the growth prospects of the paper division. The report recommended a change in the product mix, which included undertaking manufacture of newsprint at the company's factory in Titagarh. At present the company has two paper mills in Titagarh and Kakinada.
The company has so far spent Rs 180 crore on the modernisation of its two paper units. The company is also stepping up exports of its wagon components business.
