Amtek may buy R H Dalmia’s OCL

Delhi's auto-parts maker Amtek Auto Ltd, is in talks to buy OCL Iron and Steel Ltd in a deal that could value the company at around Rs350 crore. Amtek is looking to acquire a steel company with captive iron ore coal mines as part of its strategy of backward integration, a newspaper reported on Thursday.

Amtek is promoted by Arvind Dham, while OCL is controlled by Raghu Hari Dalmia. It has captive iron ore mines of around 5 million tonnes and coal mines of around 20 million tonnes. It also has a 20,000 tonne a year sponge iron unit and is settin up a blast furnace, according to a Hindustan Times report quoting sources.

The deal could be closed as early as next month through a special purpose vehicle that will be funded by the promoters and partially funded by Amtek Auto, the paper said, quoting unnamed sources. Both companies have declined to comment officially.

In 2007-08, OISL had reported revenues of Rs177 crore and net profit of Rs8.4 crore. The promoters hold 61 per cent of the company.