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Wednesday, September 13, 2006

IMFA plans to go public amid revamp

The Orissa-based chrome ore major, Indian Metals and Ferro Alloys, IMFA, is embarking on an elaborate process of consolidation, public offering and extensive investment to sharply upscale both its size of operations and market share, reports Business Standard.

In the first place, IMFA is to merge its subsidiary Indian Charge Chrome, ICCL with itself. "The merger should take place any time from now as the court convened meeting of the shareholders and the follow up petition are over. Post merger IMFA will be listed on major stock exchanges. The listing is expected to take place by October," said Subhrakant Panda, managing director.

"The merger will consolidate IMFA's position as the largest ferrochrome manufacturing company in the country," he said. As a result of the merger the promoters' holding in IMFA will come down to 57% from the existing 76%.

Currently, ICCL is the listed entity on the Bombay Stock Exchange, BSE and other stock exchanges, which will automatically de-list post merger. ICCL produces charge chrome, which has lower chrome content than ferrochrome.

The IMFA group is the largest producer and exporter of ferro chrome, with a current domestic capacity of 157 MvA, backed by a 108 mw captive thermal power plant. Tata Steel and Ferro Alloy Corporation are the other makers of the commodity.

To further consolidate its market share, IMFA, armed with the proceeds of the issue, plans to invest Rs 750 crore (Rs 7.50 billion) in setting up new ferro chrome plants and related captive power facilities.

"We are in talks with the Orissa government for more ferro chrome mine allotment in the immediate future that will secure us enough reserves to extract four lakh tonne of ferrochrome ore every year," said Panda.

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