The Klöckner Pentaplast Group announced plans to build a manufacturing plant in India in Aurangabad. Recognized as leading White Field Paper Mills to set up plant in Andhra

The White Field Paper Mills Limited, promoted by a Bangalore-based businessman, is expected to sign a memorandum of understanding with the Andhra Pradesh government to set up a paper plant at Kovvuru in West Godavari district shortly.

A team of the company's representatives led by its chairman T Srinivasa Rao met chief minister Y S Rajasekhara Reddy and explained their plans about the proposed paper plant.

The company representatives, who are also planning to seek a special economic zone (SEZ) status for the proposed plant, have requested the state government to allot about 250 acres of land to set up operations.

The company would import wood pulp required by the plant from Sweden, officials said. Details like the proposed capacity or the size of investments are not immediately known.

Sirpur Paper declares 25% interim dividend

Sirpur Paper Mills Ltd has informed that its board of directors, has declared an interim dividend of Rs 2.50 (25%) per fully-paid ordinary shares of Rs 10 each and proportionate dividend Re 1 on partly paid shares (Rs 4 paid up) for the financial year ending March 31, 2006.

The company has also informed that the trading in the partly paid-up equity shares (Series E1) of the company will be suspended with effect from March 24.

JK Paper to raise $17 million overseas

JK Paper Ltd will raise $17 million through a gross depository receipt (GDR) issue and foreign currency convertible bonds (FCCBs) to part finance its Rs 335 crore (US$ 74.7 million) expansion plans.

"The decision was cleared by the board today and the issue will take place in the next 15-30 days," said Satish Mandhana, chief financial officer and head of business strategy of the company.

To fund the expansion, the company has already entered into an agreement with Washington-based International Finance Corporation (IFC) to allot 10 per cent of its equity shares worth Rs 50 crore (US$ 11.11 million).

Promoters and internal accruals would invest about another Rs 50 crore each towards this expansion. The GDRs and FCCBs would together raise the required remaining capital.

With the $17-million capital raise, the company will be "financially closed for the investment plans and will thus not be raising capital from the stock market", said Mandhana.

The Rs 335-crore expansion plan includes the setting up of a 60,000 tonne per annum (tpa) multi-layer packaging board plant in Surat, Gujarat, and some modernisation projects.

Further, the funds raised through the GDRs and FCCBs will not be used for the next stage of investment of Rs 700 crore (US$ 155.55 million) that the company plans to make in the next 3-5 years.

"The Rs 700-crore expansion plans are still at the drawing board stage. We first wish to complete current phase of expansion," added Mandhana.

Bilt scouting for mill, plantation in East Asia

Ballarpur Industries Ltd (Bilt) is scouting for a plantation or a pulp mill with plantation in Vietnam, Malaysia, Thailand or Indonesia.

The company is also in talks with the Malaysian government for a 50,000-100,000 hectare plantation to start supplying in 6-7 years, according to B Hariharan, group finance director.

The company is keen to get a pulp mill attached to a plantation but the search so far has not got much headway, said Hariharan.

"The process is on, but we have also started considering plantations where setting up a greenfield plant may be lucrative."

A plantation or a pulp mill with plantation is required to help meet the ever rising raw material demand following the company's Rs 1,200 crore (US$ 266.67 million) expansion plan to double its production capacity by March 2008.

Post-expansion, its production capacity will be raised to 850,000 tonne per annum from the present 450,000 tonne. In case of coated paper, it will be raised to 280,000 tonne from the current 125,000 tonne and that of uncoated paper to 550,000 tonne from 340,000 tonne.

In the uncoated paper segment, Bilt is able to sell its total production in the domestic market and hopes the equation to remain the same post-expansion also.

However, in the coated paper segment, Bilt projects exports of 20,000 tonne, out of the current 125,000 tonne output.

"After its expansion, the company will have to export about 50 per cent of the enhanced capacity. We have markets in the US, Australia, south east Asia and Europe," said Hariharan.

Bilt expects its revenue from exports at Rs 100 crore (US$ 22.22 million) in the current financial year 2005-06 (July-June), he added. The company plans to merge a group unit, APR Packaging, with itself and a meeting of shareholders will be held on March 31 for considering the scheme.

APR is already supplying to meet raw material demand and will continue to do so post-expansion.

Discussing about the progress of the expansion plan, Hariharan said that the letters of intent for machinery will be signed in the first week of April.

"The commissioned value of plant machinery is $150-160 million with a delivery time of 13-14 months, followed by another six months for commissioning. We hope to complete expansion by March 2008."