The Hindu Business Line : Andrew Yule to spin off electrical and engineering biz

As part of its revival package that has been approved by the Board for Industrial & Financial Reconstruction (BIFR), Andrew Yule & Co Ltd has decided to spin off its electrical and engineering businesses into separate companies while retaining its tea business under its own banner. The company also proposes to unlock its investments and bond issues in other companies, including group companies, with a view to generating the cash funding that is required under the revival package.

Addressing a news conference held here on Wednesday, Mr Kallol Datta, Chairman & Managing Director of Andrew Yule & Co Ltd, said the BIFR had approved the revival package of the company, which is a public sector undertaking under the Union Ministry of Heavy Industries.

Revival package

Mr Datta said the total non-cash support to be provided by the government as part of the revival package was Rs 490.83 crore. Of this, Rs 122.16 crore would be from conversion of loans to equity, Rs 111.96 crore as guarantee to banks, Rs 32.59 crore as waivers and Rs 224.12 crore as write-down of equity. Besides non-cash support, the cash funding under the revival package would be to the tune of Rs 151.21 crore, which would be met through the unlocking of investments and bond issues.

The government would also provide Rs 87.06 crore as interest-free loan to Andrew Yule to be funded out of disinvestments of its shares in various group companies. The company’s accumulated loss has been pegged at Rs 431 crore. The Union Ministry of Heavy Industries has been providing budgetary support to Andrew Yule for the last three years.

According to Mr Datta, the net worth of the company was expected to become positive in the current fiscal and it expects to come out of BIFR within the next three-four years. The government owns 97.56 per cent of the equity stake in Andrew Yule & Co Ltd, with the balance being held by financial institutions and the public. Its associate companies include Tide Water Oil Co (I) Ltd, Hooghly Printing Co. Ltd, WEBFIL Ltd, Yule Financing & Leasing Ltd, DPSC Ltd and Phoenix Yule Ltd. Andrew Yule has a turnover of Rs 1,000 crore and employs 18,000 people. It has 15 tea gardens under its fold.

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