EID Parry to seek shareholders' nod for merger of 3 subsidiaries

By Our Corporate Reporter

CHENNAI, DEC. 21. The directors of EID Parry have convened an extraordinary general meeting of shareholders on January 8, 2001 to consider the scheme of amalgamation of Pettavaittalai Sugars and Chemicals Limited (PSCL), Johnson Pedder Limited (JPL) and Dhanyalakshmi Investments Limited (DIL).

While EID Parry holds 98 per cent of the paid-up capital of Pettavaittalai Sugars and Chemicals, the other two are wholly- owned subsidiaries of EID Parry.

Under the scheme of amalgamation, the shareholders of PSCL will be allotted one equity share of Rs. 10 each of EID Parry for every 20 shares of Rs. 10 each held in PSCL. The share exchange ratio has been fixed on the basis of the valuation report of Lovelock & Lewes, statutory auditors of EID Parry and Billimoria & Company, an independent firm of chartered accountants.

Since JPL and DIL are wholly owned subsidiaries of EID Parry no shares would be allotted on amalgamation and the shares held by EID Parry in these companies will get cancelled.

The equity capital of PSEL is Rs. 28 crores and that of EID Parry, Rs. 17.82 crores. There would not be any significant increase in the equity capital of EID Parry, post merger.

The merger scheme is effective from April 1, 2000.

PSCL is engaged in the manufacture of sugar, JPL in the manufacture of sanitaryware and DIL in investment business. Since EID Parry is a producer of sugar and sanitaryware among other products, the activities of PSCL and JPL can be advantageously combined with those of EID Parry. Also, the financial strength of EID Parry can be effectively combined with the expertise of DIL consequent to the amalgamation.

It has been stated that the pooling of manufacturing facilities of PSCL and JPL would result in considerable cost saving and an increase in productivity. The amalgamation would thus provide for consolidation of sugar and sanitaryware businesses.

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Section  : Business
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