APL Apollo Tubes to acquire Lloyds Line Pipes for Rs40 crore
21 Sep 2010
APL Apollo Tubes, manufacturer of ERW steel pipes, tubes and hollow sections, has announced plans to acquire Lloyds Line Pipe, another manufacturer of steel tubes, for around Rs40 crore, to boost its production capacity.
Lloyds Line Pipe operates a 90,000 tonnes a year capacity steel tubes plant at the MIDC area, in Murbad, Maharashtra. Lloyds Line Pipes' facilities are API certified and the company can manufacture pipes of up to 14" diameter.
The acquisition, valued at Rs40 crore, will be paid partly in cash and partly by a preferential issue of equity shares, APL Apollo Tubes Ltd said in a filing with the Bombay Stock Exchange (BSE).
The company said it would allot 1,136,364 equity shares to the promoters of Lloyds Line Pipes at Rs176 a piece, and pay the balance amount of Rs20 crore in cash.
The acquisition will boost APL Apollo Tubes' annual production capacity from the existing 400,000 tonnes to 490,000 tonnes.
APL Apollo Tubes said it has also forged a strategic alliance with Shankara Pipes, under which it will allot 425,000 fully paid-up equity shares to Shankara Pipes at Rs176 each, for cash.