Date:18/02/2006 URL: http://www.thehindubusinessline.com/2006/02/18/stories/2006021803210200.htm

Back Spentex Industries set to acquire Indo Rama Textiles

Our Bureau

New Delhi , Feb 17

SPENTEX Industries Ltd plans to acquire majority stake in Indo Rama Textiles Ltd through a buyout of up to 50 per cent of the company's fully paid-up equity share capital from existing promoters, in addition to the 14.99 per cent already held by it.

Spentex, which manufactures cotton yarn, expects to become one of India's top yarn manufacturing companies with the acquisition of Indo Rama, which has two modern plants to manufacture synthetic blended yarns.

"We have entered into an agreement to purchase 50 per cent stake from the promoters of Indo Rama Textiles at Rs 84.15 a share," said Mr Mukund Choudhary, Managing Director of Spentex.

He also said that the company would announce an open offer to buy 20 per cent more next week at the same price. Earlier in the day, Spentex bought 14.99 per cent of Indo Rama in a market deal valued at Rs 37.4 crore.

The Spentex scrip dropped 2.24 per cent to Rs 52.4 on the BSE on Friday, while Indo Rama lost 6.4 per cent to close at Rs 71.1.