The Tata Projects Ltd (TPL), an yet-to-be-listed company has recently announced that it has acquired a 75% stake in the Artson Engineering Ltd for an investment of around Rs. 33 crore. The company is having a market capitalization of Rs. 1,000 crore and the officials of the company have informed that the acquisition process was completed on Friday.
The officials of TPL were also talking about the formation of Artson after the acquisition and a top official said that the former Managing Director of TPL, Mr. K.P. Singh would become the Chairman of the new five-member board of Artson. The official also said that Artson is a listed engineering firm and the company is specialist in the fields of piping and large diameter storage. The sources from the Bombay House have stated that the proposed 50:50 Joint Venture (JV) company between TPL and EIL was expected to float finally in March. The sources also mentioned this acquisition as crucial for the company ahead of the JVs execution.
A reliable source from TPL has stated that the new JV between the company and EIL would focus mainly on the oil and gas sector and it would also increase the strength of EIL in engineering. The JV would boast the procurement and construction expertise of TPL as well. In the words of senior Tata Group source, "Artsons capabilities and its status as one of the qualified vendors of EIL makes the acquisition a strategic fit". The Chairman of the new board of Artson, Mr. K.P. Singh will also become the representative of Tata in the proposed four-member board of the new JV company. The officials of TPL further informed that the board of Artson has already allotted 2,76,90,000 equity shares at a rate of Re 1 each to TPL on Friday and the company has decided that the five-member new board of Artson would include two existing board members and it would work independently.
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| Posted : 1/8/2008 |
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