Intron plans Rs 16 cr rights issue at par
Jai Kumar NR
NEW DELHI, January 13: Intron Ltd, an AB Electrolux subsidiary, is planning a Rs 16-crore rights issue sometime in the middle of this year. To be offered in the ratio of one share for every share held in the company, it is likely to be priced at par.According to a company official, the cash-strapped Intron is going in for a fresh equity infusion to meet its working capital requirements. As the company's entire paid up capital is wiped out due to accumulated losses, the company has no other option but to tap its shareholders for meeting short-term fund requirements. As on March 31, 1997 Intron's accumulated losses are to the tune of Rs 24 crore. "Even to get bank finance for meeting working capital requirements, we need to infuse fresh equity as our entire paid up capital is wiped off," the official added. However, the company is yet to file the offer document with the Securities Exchange Board of India. The promoters, who currently hold 51 per cent in Intron, also plan to pick up additional equity
shares if the rights offer faces any short-fall in subscription. In that case, the promoters' stake will go up substantially. However, if the market conditions improve, the promoters may not require to pick additional equity shares, the official added. As the company has been deep into the red for the past couple of years, its stock has received severe drubbing on the Mumbai Stock Exchange. The scrip had fallen below par in January 1997 and has not reverted back ever since. The stock is currently hovering around Rs 4.80. Intron is a 51-per cent subsidiary of the Swedish home appliances major AB Electrolux. The Swedish company has already started cleaning up its loss-making subsidiary's balance sheet by paying off a large portion of Intron's high-interest debts. Intron has accumulated losses of Rs 24.25 crore against against an equity of Rs 15.75 crore for the 15-month period ended March 31, 1997. During the period under consideration, the company has reported a net loss of Rs 5.57 crore on sales ofRs 38 lakh. Interest cost had increased to Rs 2.33 crore.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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