Hyderabad, Nov 23: The management of VST Industries has decided to hive of agro-processing arm, VST Natural Products, to the Golden Green Company, the Bangalore-based 100 per cent subsidiary of Ballarpur Industries (Bilt), of the Thapars. Golden Green is understood to be on an acquisition spree and is said to have concluded the takeover of the Chennai-based Saptarishi Mushrooms some time back, according to industry sources.The move to hive off its subsidiary is in line with VST's resolve at its last board meeting in May to exit from non-core areas such as financial services and agro-processing as part of its restructuring programme. Though a VST release on Tuesday did not disclose the terms of sale "owing to sensitivities involved", the company had said earlier it expected a realisation of an estimated Rs 20 crore from the NPL hive off.
The proceeds of the sale would be deployed for the company's restructuring exercise and retiring debt, the VST managing director Raymond Noronha said in the statement.
Considered a drain on the parent company's finances since its inception five years back, VST-NPL's sale has been on the cards for some time now with the management holding discussions with several suitors, including Bicks of Canada and even ConAgra till some time back.
The VST management had provided an extraordinary charge of Rs 91.6 crore in its accounts for 1998-99 towards restructuring of its financial services and agri-products operations with Rs 53 crore being provided towards NPL alone, resulting in a net loss of Rs 88.8 crore.
Rabo India Finance, a subsidiary of RaboBank International had been entrusted the job finding a suitable buyer for the ailing VST subsidiary.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.