15 January 1998: Floatglass India Ltd (FIL), a joint venture between Asahi Glass company of Japan, ACC, Telco and Tata Exports Ltd., has decided to issue 10% cumulative redeemable preference shares (C…
15 January 1998: Floatglass India Ltd (FIL), a joint venture between Asahi Glass company of Japan, ACC, Telco and Tata Exports Ltd., has decided to issue 10% cumulative redeemable preference shares (CRPS) to Asahi Glass. This placement, which is being made at Rs 100 per share, will supposedly “clean up” Rs 200 million and is expected to bail out the cash-strapped company from difficulties. According to the proposal cleared by the company“s board recently, the CRPS will be redeemed after the completion of 10 years and carry a fixed dividend of 10% per annum payable out of FIL“s profits. The company has submitted its application with the Foreign Investment Promotion Board (FIPB) and expects to get a clearance soon. FIL has already issued preference shares worth Rs 48 crore to the promoters in November 1997 and the company has sought permission to issue additional 10% preference shares in its application. The preference shares are being issued by the company by converting a part of the soft loan of US$ 13.2 million already given by Asahi Glass. The loan was said to have been given by the Japanese firm in 1997-98 to make Floatglass“s net worth positive and prevent it from being declared sick. Floatglass has reported an accumulated loss of nearly Rs 1.7 billion, which is more than 50% of its net worth of Rs 2.1 billion.