New Delhi: Pune-based Kinetic group on Wednesday announced completion of a restructuring plan under which its erstwhile two-wheeler business Kinetic Motor Co (KMC) has been merged with automotive components arm Kinetic Engineering Ltd.
The group also said Kinetic Engineering Ltd (KEL) has received approval from RBI for extension of conversion or redemption of USD 18 million FCCB till February 2014.
"Going forward, our strategy will be to become a leading automotive systems and components player with powertrain systems as its focal point," KEL Vice-Chairperson Sulajja Firodia Motwani told PTI.
The Bombay High Court has granted approval for the merger of KMC with KEL. Subsequently, promoters' stake in KEL would be reduced to 53 per cent from 57 per cent earlier, she added.
Motwani further said the investment of 6.12 crore shares of Rs 10 each in Mahindra Two Wheelers Ltd, valued at a face value of around Rs 61 crore, will be directly held by the KEL subsequent to the merger.
Asked about the future plans of KEL, she said: "We will try to expand our business in the powertrain segment with new customers. We will look to tap automobile companies which have base in Western India."
At present the company is working on gearboxes for Mahindra's heavy commercial vehicles and also for Piaggio, she added.
KEL is one of the biggest suppliers of transmission system to Mahindra Two-wheelers. It also supplies gear boxes to Tata Motors for Nano car.
On the extension of deadline for conversion/redemption of FCCB, the company said it had approached its bondholders, who consented to the restructuring by extending the tenure by a 100 per cent votes cast in favour.
There will be no change in conversion price as was fixed at Rs 156 per share at the time of issue of FCCBs, it added.
"The current market price of the KEL scrip is also around Rs 120, so it gives us a year's time for value creation and we are confident of it considering the programme that we have put in place," Motwani said.
First Published: Wednesday, February 13, 2013, 17:50