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| Exchange Disseminated Time | Jay Shree Tea & Industries Ltd has informed BSE that in the Board Meeting of the Company held on March 30, 2010, the Memorandum of Understanding (MOU) entered into with the shareholders M. P. Chini Industries Ltd. to acquire 100% paid up share capital of the said company at a price of Rs. 112.50 crore (Rupees one hundred twelve crore and fifty lac only) has been approved.
In this regard, the Company has submitted to BSE a Press Release.
Press Release :
"Jay Shree Tea & Industries Ltd, (JSTI) - a B K Birla Group company is acquiring 100% stake in a sugar company having a factory in Bihar with a capacity of 4600 TCD, being enhanced to 5500 TCD. The factory also has co-generation capacity of 6 MW and a thousand acre sugarcane plantation.
Jay Shree Tea, a major producer of tea is the only company having presence of all tea growing areas of India and it has established its core competency in the area of agro based practices. The Current acquisition will enable JSTI to leverage its experience and expertise in managing agro based industries and harnessing the same for growth of all its stakeholders. JSTI's foray into sugar compliments its existing operation in tea very well with both products being a staple part of the common man’s basket of purchases.
The sugar industry has witnessed firm prices on the back of unprecedented shortages, not just in India, but also worldwide. India sugar consumption is estimated to reach 24 million tones by 2011-12 as against a current production of 16.80 million tonnes.
The cost of acquisition of the said mill for JSTI on existing capacity of 4600 TCD on
the basis of average 112 day crushing (5,15,000 tonnes per annum) works out to Rs. 2150/- per tonne. On expanded capacity of 5500 TCD, this works out to Rs. 2025/-.
It may be pertinent to note that the recent overseas deal for sugar by an Indian company in Brazil was at a price of Rs. 29OO/- per tonne of crushing capacity. The standard in the industry for valuation of sugar varies between Rs. 2500/- to Rs 3000/- per ton. The recent asking price for 73500 TCD sugar mills in UP is Rs. 4500/- per ton.
It may be noted that the nine months ended December 31, 2009 the company posted a total income of Rs. 322 crore and net profit of Rs. 79 crore." |
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