The Hindu : Business : L&T cement division demerger to be over by June

Online edition of India's National Newspaper
Saturday, Apr 10, 2004

Business

Business

L&T cement division demerger to be over by June

NEW DELHI, APRIL 9. Engineering major Larsen & Toubro today said the process of demerging its cement division into a separate company Ultra Tech CemCo would be over by the middle of this year.

"The process of cement division demerger is likely to be over by June, 2004," L&T Chairman, A. M. Naik, told PTI. The company, however, would continue to have a residual interest and also have two directors on the demerged entity's board, he added.

After the final demerger, L&T would have 11.5 per cent holding in CemCo, while Grasim would hold 51 per cent along with the management control.

On the reason behind retaining residual interest in the demerged entity, Mr. Naik said the decision was technical in nature. "The residual interest in CemCo would allow us to bid for the high net worth global construction projects," he said. L&T decided to hive off its cement division in favour of Kumarmangalam Birla-led Grasim Industries last year. Predicting future trend, he said the prices of the cement scrips would witness an upward movement in the next 3-4 years due to sustained focus on development of basic infrastructure facilities. This would, in turn, ensure higher consumption demand for cement, he added.

PTI

Printer friendly page
Send this article to Friends by E-Mail

Business