INDIA: Apollo Tyres to raise Rs 4500 m to fund overseas buys
Source: Daily "The Hindu Business Line", New Delhi; 13 Apr 2006
New Delhi , April 12
The Rs 26500-million Apollo Tyres Ltd (ATL) would soon
seek shareholders' approval to raise an amount not
exceeding Rs 4500 million for meeting fund
requirements in connection with global acquisitions,
normal capital expenditure and general business
A company official said the approval sought would be
in the nature of an overall approval as the type of
securities that would be issued and the market that
would be tapped was yet to be finalised.
ATL is in the process of appointing merchant bankers,
who are expected to recommend a number of options for
fund raising through the equity route.
Post-shareholder approval, the final decision on the
equity instrument, the extent of funds to be raised
and the market from which the funds would be raised
would be decided by the board after considering the
recommendations of the merchant bankers.
Meanwhile, ATL said in a release to the stock
exchanges on 12 Apr. that shareholders' nod would be
sought to authorise the board for issuance of
securities for an amount not exceeding Rs 4500 million
(including share premium) by way of public issue,
rights issue or otherwise in the domestic and
international markets, in one or more tranches.
`Beyond Dunlop Africa'
A committee of directors (funds raising) of ATL met on
11 Apr. and decided to seek shareholders' nod through
the postal ballot for this purpose. Moreover,
shareholders' nod is also being sought for increasing
the authorised capital from Rs 500 million to Rs 750
million by amending the memorandum and articles of
association of the company.
Asked whether the proposed fund raising was aimed at
financing the acquisition of Dunlop South Africa, a
company official said "not really" and highlighted
that it was for funding global acquisitions "beyond
Dunlop South Africa".
ATL had in late January this year announced that it
was acquiring the Durban-headquartered Dunlop Tyres
International (Pty) Ltd (Dunlop South Africa) through
a 100 per cent equity buyout transaction for Rs 2900
(Syed Rashid Ali, Karachi, Pakistan)