Bridgestone acquires ACC, Telco stake in JV for Rs 67 crore

Our Corporate Bureau
17 December 2002

Mumbai: Bridgestone is acquiring the 19.56-per cent stake held by Associated Cement Companies (ACC) and the 6.44-per cent of Telco in the joint venture (JV) company, Bridgestone ACC India, for about Rs 67 crore.

After the acquisition is over, the company will become a completely foreign-owned entity. Bridgestone, the US-based company which is a global tyre manufacturer giant, will hold 90-per cent stake in the company, and Mitsui of Japan will hold the rest.

Telco is being paid a premium of Rs 6.65 crore on its shareholding of Rs 10 crore at the moment, while ACC is being paid a premium of Rs 19.85 crore on its shareholding of Rs 30.35 crore.

This acquisition will increase Bridgestone’s total investment in the JV to Rs 139.7 crore from the existing Rs 99.7 crore. The JV company, set up six years back to manufacture tyres, is based in the Dhar district of Madhya Pradesh.

While the respective boards had given the green signal for divestment, the deal was awaiting the necessary approvals from the government and the Reserve Bank of India. The minority holding of 51 shares presently held by Japanese members, who are resident individuals, will remain as it is. But the 49 shares held by resident Indians will be part of the sale to Bridgestone.

ACC and Telco were planning to offload their stakes as part of their business strategy in order to focus only on core activities and not to make further investments in other businesses.