Vedanta plans to acquire entire shares of Madras Aluminium

January 20th, 2009 - 6:32 pm ICT by IANS  

Chennai, Jan 20 (IANS) Contrary to its earlier restructuring plans for Madras Aluminium Co (Malco), the Vedanta group has decided to acquire the entire shareholding of the Salem-based firm and perhaps delist the scrip. In a regulatory statement to the National Stock Exchange Tuesday, Malco said its holding company, Vedanta subsidiary Twinstar Holdings with a controlling 80 percent stake, has proposed to acquire the remaining 20 percent as per the market regulator’s guidelines on delisting of securities.

The latest decision to buy out the minority shareholders is in variance with the restructuring proposals announced last September.

At that time, the Vedanta group had planned to house all its aluminium business under Malco and demerge its investments in group companies like Sterlite Industries.

Under the earlier proposal, the holding of Vedanta group was to go down to 60.92 percent with the balance being held by the shareholders of Malco and Sterlite.

Meanwhile, Malco has declared a net loss of Rs.71.3 million for the third quarter ended Dec 31, as against a profit of Rs.147.2 million for the corresponding period the previous year.

Interestingly, the company’s net revenue for the third quarter stood at Rs.1.17 billion, up from Rs.1.10 billion earned during the corresponding period the previous year.

After suspending 60 percent of its production last November, Malco stopped its smelter operations entirely last month, citing the low prices for aluminium in the London Metals Exchange (LME) as the reason.

The company is also facing some court case in operating its bauxite mines in Tamil Nadu.

Malco owns bauxite mines with 1.7-million tonne reserves in Salem and Namakkal districts in Tamil Nadu.

The company also owns a 120,000-tonne per annum aluminium refinery, a 40,000-tonne smelter and a 75-MW captive power plant at Mettur in the state.

Malco officials were not available for comments.

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