Mumbai, 7 July 2004
UltraTech CemCo, the new cement company within
the AV Birla Group fold, will launch a new national
cement brand once the Larsen & Toubro (L&T)
brand is phased out. The work on the brand will
start after the monsoon and it would become operational
once the L&T brand is phased out by March
Grasim will continue with its two major brands
Birla Super and Birla Plus and some
of its regional brands.
are looking at aggressive investments in the cement
business. Grasim will be a conglomerate with two
major business lines VSF and cement. Cement
will be the main growth engine, said AV
Birla Group chairman Kumar Mangalam Birla, at
a press meet to announce the completion of the
scheme of demerger of L&Ts cement business.
boards of L&T and CemCo met on Tuesday and
Grasim was formally handed over management control
Birla will chair the CemCo board while Saurabh
Misra will be the CEO. DD Rathi, Dr Santrupt Mishra,
Ms Rajashree Birla and KC Birla will be on the
board from the Birlas, YM Deosthalee and JP Nayak
from L&T, S Rajagopal and MSK Khare from the
financial institutions, while RC Bhargava and
Arun Gandhi will be independent directors on the
the transfer of the Grasim stake of 14.95 per
cent in L&T to the L&T Employees
Welfare Foundation, Mr Birla and Mrs Birla have
stepped down from the L&T board.
Birla said that there would be Rs 100 crore savings
between the two companies on account of savings
in logistics and procurement. We have paid
an aggressive price for the cement business and
we will have to work hard to recover it. It will
take two-three years to reach the rate of return,
Mr Birla added.
that it was a win-win situation for both sides,
L&T chairman and managing director AM Naik
said, L&T will now become a focused
engineering company with high-tech manufacturing
and high-end construction. Grasim will prosper
through a very competent workforce with operational
L&T board is also being reconstituted with
Suresh Talwar of Crawford Bayley and MP Chitale
being proposed to be inducted as independent directors.
L&T Infotech CEO VK Magapu will also be inducted
on the board as an executive director.
shareholding pattern in CemCo currently stands
with the Birlas holding 51 per cent, L&T having
11.5 per cent, FIs with 12 per cent and the rest
with retail and institutional investors.