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MERGERS & ACQUISITION


We are glad to share that the Company has received Final Order dated 25th October, 2000 from the Hon’ble High Court of Rajasthan, for the Merger of Telecords (India) Private Limited with the Company which has also been registered with Registrar of Companies on even date. As such the effective date of Merger is 25th October, 2000.

RATIONALE BEHIND MERGER

To achieve higher value addition and to integrate backwards, the Company entered into a Scheme of Merger with the Telecords (India) Private Limited, a leading manufacturer of Fibre Reinforced Plastic Rod (FRP rod) with an installed capacity of 1,00,000 KMs FRP Rods.

Fibre Reinforced Plastic (FRP) Rods is an important part of raw material which provides the necessary tensile strength for the production and laying of Optical Fibre Cables. It consumes about 25% of the cable cost.

At present, the FRP is in scarcity and is manufactured in India only by two companies i.e. Telecords India Private Limited and Indore Composite which has created a duopoly position in the market and the manufacturers of the OFC are required to import FRP due to this scarcity for meeting the supply commitment to DOT. The FRP manufactured by Telecords constitute 27% of the cable cost. Merger of Telecords (India) Limited with the Company has ensured availability of FRP in-house and can reduce the FRP Cost by 50% enhancing profitability of the Company.Further, Telecords (India) Private Limited had its own strong Research and Development facility, the benefit of which is now available with the Company.

The consideration for the said merger is entirely through stock swap in the ratio of 167.4 equity shares of Rs.5/- each of Aksh Optifibre Limited for every one share of Rs.100 each of Telecords (India) Private Limited. As a result of Merger 16,60,942 equity shares of Rs.5/- each of Aksh has been issued & allotted to the Members of Telecords (India) Private Limited on 28th October, 2000.

As such the Paid-Up Capital of the Company as on 28.10.2000 is Rs.11,01,89,460/- divided into 2,20,37,892 Equity Shares of Rs.5/- each.

With this Merger, Aksh is the only Company in India with backward integration into manufacture of FRP rods as well as Optical Fibre. This gives it competitive edge with lower input costs, more specifically over cost of Optical Fibre and FRP rod which together accounts for approximately over 50% of cost of Optical Fibre Cable.

This Merger paves the way for Aksh to jumpstart its direct to home FRP encased cable for which it has applied for US and Indian Patent. Results for the first half year, post merger, put its total turnover at Rs.58.52 Crores and PAT at Rs.4.01 Crores.

 

 
 
 

 

 

 
     
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