The Ruia group, which owns the Dunlop brand in India, has submitted a financial bid for ailing Birla Tyres Ltd.
The Calcutta-based group, which had acquired high-profile companies such as Dunlop India Ltd and Jessop & Co Ltd between 2003 and 05, is competing with the mighty Dalmia Bharat group in the final stage of the corporate resolution insolvency process of BTL.
The initiative from the Ruia group is being led by Sakchi Ruia, daughter of Pawan K. Ruia, founder of the group. Sakchi is based out of Singapore and manages a company called Dunlop Tyres Pte Ltd.
Sources in the Ruia group said Sakchi plans to revive the company if she gets it. However, the odds will be stacked against the Ruia group given its chequered history of failed attempts to revive sick units such as Dunlop and Jessop.
Birla Tyres, promoted by the Basant Kumar Birla group, was admitted by the Calcutta bench of the National Company Law Tribunal on May 5, 2022, following a petition filed by operational creditor SRF Ltd.
The admitted claim by the financial creditors of the company stood at Rs 1,128.29 crore. However, the bids by the two companies are understood to be within the range of Rs 150 crore. The bids will likely be revised upwards.
The Balasore plant spread over 181 acres of land is a notable asset to the company. It used to primarily manufacture two-wheeler and bus and truck tyres. It used to employ close to 3,000 people, including temporary and contractual workers.
To expand into the fast-growing radial passenger car tyre segment, the company under the Birla family management was planning to set up a unit which remained unfinished for many years. Estimates suggest Rs 700 crore infusion is required to complete the unit.
In 2016, it sold off the more modern Haridwar unit to JK Tyre for Rs 2,195 crore to pare mounting debt and retained the older Balasore plant in Odisha.
BTL was created after demerging the tyre business from Kesoram Industries Ltd in 2020.
The move was aimed at ring-fencing the cement maker Kesoram from the continuous losses of the tyre unit.
