BILT Paper acquires Sinar Mas in Rs. 530 cr. deal

NEW DELHI, MAY 11. The Thapar group company BILT Paper Holdings today announced the acquisition of 100 per cent equity of Sinar Mas Pulp & Paper India (SMI) for $114.5 million (approximately Rs. 530 crores) from Sinar Mas Pulp and Paper (Mauritius).

The acquisition, seen as possibly the largest in the Indian paper industry, was completed today and the acquired company's name stands changed to BILT Graphic Papers India, BILT vice-chairman and managing director, Mr. Gautam Thapar, told newspersons here.

``The acquisition holds enormous significance for the BILT Paper group as it has huge synergies with our existing businesses and plans. It will also strengthen our position as the largest paper and paper board manufacturer in India and help us emerge as a significant player in the Asian region, as we explore other meaningful alliances and acquisitions," he said.

Post acquisition, Ballarpur Industries' coated paper capacity stands considerably enhanced; also against the only 3-4 per cent share of the coated paper market BILT holds, the new company holds 32-35 per cent share of this market.

The deal was valued at $114.5 million, including a purchase price of $62.5 million for equity and the assumption of liability of Sinar Mas (India) amounting to $52 million, which was financed through ICICI, Standard Chartered Bank and Rabo Bank.

Sinar Mas India has a plant near Bhigwan, Pune, with 1.15 lakh tonne capacity and ``this, coupled with BILT group's own existing capacities will increase its marketable pulp, paper and paper board capacity to more than half a million tonnes. This will also give it a cutting edge growth of 50 per cent, making it (BILT) the undisputed leader in the top end segment of coated paper in India," Mr. Thapar said.

BILT will increase the manufacturing capacity of the acquired company in two phases; 15,000 tonnes over the next six months at Rs. 2-3 crore investment and 20,000 tonnes thereafter.

He said BILT at present has 1.5 lakh tonnes of coated paper capacity, two lakh tonnes of uncoated paper, 80,000 tonnes of coated boards, 45,000 tonnes of sack craft and one lakh tonnes of pulp. At present, the BILT group has seven pulp and paper manufacturing facilities spread across the country in Maharashtra, Haryana, Orissa, Andhra Pradesh and Tamil Nadu.

Brings in professionalism

Ballarpur Industries (BILT) will soon complete reorganisation of its board of directors from which two Thapar family members are resigning and the number of executive directors will be increased to five. This board reorganisation is aimed at making the group more professional, and should ultimately result in the number of independent directors exceeding the non-independent ones, BILT managing director, Mr. Gautam Thapar, told PTI.

``We have already begun reorganisation of the board of directors. Three new directors will be appointed by June-July, when we go into our next accounting year," Mr. Thapar said adding this exercise would cut the number of total directors to 11 from 13 at present.

In the new structure, there will be five independent directors, three institutional ones and four company appointed ones, he added.

- PTI

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