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Strategies & Market Trends : India Coffee House -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (8884)	10/24/1999 5:32:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 12475

Flex Ind, Polyplex merge to form largest polyester film producer in the country and 5th in the world. Sharad Goel (ET) NEW DELHI 24 OCTOBER IN THE first ever consolidation exercise in the Indian polyester film industry, two major competitors - Flex Industries and Polyplex Corporation - have merged their capacities to form the largest polyester film manufacturer in the country and the fifth largest in the world. Flex Industries and Polyplex Corporation have decided to form a new joint venture company - United Film Technologies (UFT) - and would hive off their respective polyester manufacturing capacities to this joint venture. The boards of both promoter companies have cleared the proposal. The Delhi-based Polyplex Corporation, with a polyester capacity of 15,000 tonne per annum, would be holding 55 per cent stake in the new joint venture while Flex Industries, one of the largest packaging firms in the country with a polyester film capacity of 24,000 tonne per annum, would be owning 45 per cent. The board of the new company, however, would have equal representation from both companies. Mr Sanjiv Saraf, managing director, Polyplex, has been appointed as the managing director (designate) of UFT and would be responsible for the day-to-day operations while Mr Ashok Chaturvedi, chairman, Flex Industries, would be the chairman of the new company. The start-up venture is expected to commence production of nearly 40,000 tonne of polyester film by early next year and is expected to report revenues of Rs 400 crore during its first fiscal ending March 2001. In India, the other polyester manufacturers include Garware Polyester (23,000 tonne), Ester Industries (18,000 tonne), MTZ Polyester (12,000 tonne), Jindal Polyester (12,000 tonne), Venlon Polyester (2,500 tonne) and SRF's polyester division (3,500 tonne). Worldwide there are four major players: Teijin-DuPont (three lakh tonne), Mitsubishi-Hoechst (1.2 lakh tonne), Toray, Japan(1.5 lakh tonne) and SKC, Japan (1 lakh tonne). Both the promoters have notified the stock exchanges and would be meeting the financial institutions for necessary approvals this week. Flex Industries, which has a turnover of nearly Rs 600 crore ($140 mil), derives approximately 40 per cent of its revenues from its polyester business. With the polyester capacity hived off, the company is expected to focus on its core business of packaging and would be buying its entire polyester film requirement from the new venture. Mr Ashok Chaturvedi, chairman, Flex Industries, said that Flex would now be able to concentrate on its core competence of packaging and hopes to turn profitable after this hive-off in the next one year with the loss making film capacity being hived off. Polyplex Corporation, with a turnover of Rs 80 crore, derives 95 per cent of its revenues from its core-business of polyester manufacturing and would concentrate on real-estate projects and photo-voltaic cell production after hiving off its capacities. Mr Sanjiv Saraf, managing director, Polyplex Corporation, said the new company would consolidate the polyester film operations in the country and help in faster growth for both players.