Bhuwalka Steel to merge group cos, bets big on real estate
Bangalore-based Bhuwalka Steel Industries is gearing itself up for a big real estate play even as it is contemplating a merger of its group companies to bring its steel business under the Bhuwalka Steel umbrella.
By PTI |
MUMBAI: Bangalore-based Bhuwalka Steel Industries is gearing itself up for a big real estate play even as it is contemplating a merger of its group companies to bring its steel business under the Bhuwalka Steel umbrella.
Two of its group companies in the steel business, Nava Karnataka Steel and the Bellary-based Benaka Sponge, are likely to be merged with Bhuwalka Steel.
Bhuwalka Steel has three manufacturing facilities -- at Bangalore, Kanchipuram in Tamil Nadu and Wada near Mumbai, and its present product portfolio includes thermo mechanically treated (TMT) bars, angles, channels, beams, flats, rounds and squares.
"The group is seriously thinking about bringing all its steel business under one umbrella. The proposal is still, however, in the early stages. There are also regulatory approvals to be obtained. The entire process is expected to be completed by end-2008," a source close to the development said.
The move is apparently prompted by the company's thinking that a merger would add synergies to the group's growing steel business and also eliminate any possible competition in the market place between the group companies.
"A merger will also usher in greater transparency in the group's operations," the source said.
Bhuwalka Steel is presently expanding its capacity at its Wada plant from 1.2 lakh mtpa to 2.04 lakh mtpa and this is expected to be commissioned by March 2008. The investment in this expansion is Rs 30 crore of which Rs 20 crore is in the form of term loans and the remaining Rs 10 crore, internal accruals.
Two of its group companies in the steel business, Nava Karnataka Steel and the Bellary-based Benaka Sponge, are likely to be merged with Bhuwalka Steel.
Bhuwalka Steel has three manufacturing facilities -- at Bangalore, Kanchipuram in Tamil Nadu and Wada near Mumbai, and its present product portfolio includes thermo mechanically treated (TMT) bars, angles, channels, beams, flats, rounds and squares.
"The group is seriously thinking about bringing all its steel business under one umbrella. The proposal is still, however, in the early stages. There are also regulatory approvals to be obtained. The entire process is expected to be completed by end-2008," a source close to the development said.
The move is apparently prompted by the company's thinking that a merger would add synergies to the group's growing steel business and also eliminate any possible competition in the market place between the group companies.
"A merger will also usher in greater transparency in the group's operations," the source said.
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Bhuwalka Steel is presently expanding its capacity at its Wada plant from 1.2 lakh mtpa to 2.04 lakh mtpa and this is expected to be commissioned by March 2008. The investment in this expansion is Rs 30 crore of which Rs 20 crore is in the form of term loans and the remaining Rs 10 crore, internal accruals.
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