RIL’s German arm files for bankruptcy
Reeba Zachariah | TNN Mumbai: The global economic turmoil has stung India Inc just when it was looking to ride the crest of the globalisation wave. Close on the heels of setbacks for Tata Motors-JLR, Corus-Teesside and Dr Reddy’s Betapharm, Reliance Industries’s (RIL) European textile unit Trevira, which was acquired from Deutsche Bank for E80 million or Rs 440 crore in 2004, has filed for bankruptcy. Trevira has sought from a German court permission to start insolvency proceedings with a restructuring plan. The company makes polyester fibres and filament yarns and supplies them mainly to the auto and home textile sectors. It reported a turnover of E323 million in 2008 and has five manufacturing plants—two in Germany and one each in Denmark, Poland and Belgium—employing around 1,800 people. While success for India Inc was forthcoming during boomtime, the downturn has ushered in bad times for the Indian biggies, who are now forced to do a rethink on their overseas operations. Curtailing production, shutting down plants, slashing workforce or, in the worst case scenario, dumping foreign units. While Trevira made several efforts to overcome the slump by cutting down costs through joint sourcing (with RIL) of raw materials, IT and finances, besides relocating to low-cost locations like Poland, the operational cost remained high. With the European and US auto industry in doldrums, there was lesser offtake of Trevira products. In the fourth quarter of 2008-09, RIL made a provision of Rs 370 crore for impairment losses of its international businesses. --~--~---------~--~----~------------~-------~--~----~ You received this message because you are subscribed to the Google Groups ""GLOBAL SPECULATORS"" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/globalspeculators?hl=en -~----------~----~----~----~------~----~------~--~---
