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Rane (Madras) board okays stake sale in 2 jt ventures

Our Bureau

CHENNAI, Dec. 5

THE board of directors of Rane (Madras) Ltd at its meeting on Monday, approved the sale of investments in joint venture companies to associate companies or financial institutions for an aggregate value of Rs 16 crore.

Mr L. Ganesh, Vice-Chairman, Rane Group, told Business Line that the transaction value for transferring the shares held by Rane (Madras) in the two joint ventures to Rane Brake Linings was Rs 9 crore and the board had obtained a blanket approval for Rs 1 6 crore.

According to him, the stake of Rane (Madras) in two of the joint ventures -- TRW Rane Occupant Restraints Ltd and Rane Nastech Ltd -- are proposed to be transferred to another group company, Rane Brake Linings Ltd.

The restructure is intended to strengthen the finances of Rane (Madras), which produces steering gears and is therefore entirely dependent upon the OE market for its business.

The cash infusion that would come from the sale of its stake in the joint ventures would enable Rane (Madras) to retire some of its high cost debt and thereby reduce its interest burden.