Visaka Industries, the asbestos and textiles major has
announced major expansion plans with an investment of
Rs228 crore which would be split between its building
materials and textiles businesses. The plans are spread
over three years.
G Vivekanand, managing director Visaka Industries, addressing
the press here said, the company would invest Rs55 crore
in setting up a garments factory at the Mahindra International
City in Chennai, Rs100 crore in a cotton spinning unit
and Rs55 crore in a weaving unit. For the company's building
materials business he announced an investment of Rs28
crore in setting up a unit in Rae Bareilly in Uttar Pradesh.
the locations of the cotton spinning unit and weaving
facility have not been finalised these are likely to come
up either in Maharashtra or Andhra Pradesh, G Vivekanand
said the company was reducing business dependence on building
materials and was planning to become a major textile player
with control over the entire chain of production.
To fund the expansion Visaka Industries is going in for
issue of foreign currency convertible bonds (FCCBs) to
raise $15 million (Rs65 crore) to part-finance the project.
It has appointed Elara Capital of London to act as merchant
bankers in charge of the issue.
company would be listed on the London Stock Exchange after
the process of raising funds was completed Dr Vivekanand
V Soorianarayanan, senior vice-president, Visaka Industries,
the conversion of FCCBs into equity shares would enable
the company improve its borrowing capacity by another
Rs70 crore. According
to him the company enjoys a comfortable debt-equity ratio
of 1:1.2, and would continue to maintain it even after
raising debt for the proposed expansion.