24. November 2005

INDIA: Ruia group may buy Jumbo's stake in Dunlop, Falcon in block deal

Source: Daily "The Hindu Business Line", New Delhi; 24 Nov 2005

Kolkata , 23 Nov 2005 The Kolkata-based Ruia group is believed to have worked out a block deal to acquire the Dubai-based Jumbo Group's controlling interest in the three tyre companies, namely, Dunlop India, Falcon Tyre and the latter's trading arm - India Tyres Ltd (ITL). ITL is a wholly owned subsidiary of Falcon. According to knowledgeable sources, the deal is likely to be completed this week. While the Ruia group Chairman, Mr P.K. Ruia, was not available for comment, sources said the deal would be struck through a special purpose vehicle. The value of the proposed acquisition may run into a couple of hundred crores. The Rs 300-crore Ruia group came into the limelight in 2003 when it acquired the ailing public sector Jessop & Co through its flagship company Ruia Cotex. Jessop was turned around in 2004-05. When contacted, a spokesperson from the office of the Jumbo Group's chairperson, Ms Vidya Chhabria, in Dubai said that there was no such development. It may be mentioned that the deal, if it comes through, will also mark the virtual exit of Jumbo from India. The group had already sold its interests in liquor major Shaw Wallace & Co, Mather and Platt, Hindustan Dorr Oliver and the logistics business of Gordon Woodroffe. Apart from a wide array of other products, Dunlop, with two facilities at Sahagunj in West Bengal and Ambattur in suburban Chennai, was the only manufacturer of aero tyres in the country. The company became sick in the late nineties and as a result operations in both the facilities employing over 7,000 workers remained closed since 2003. (Syed Rashid Ali, Karachi, Pakistan)

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