WABCO-TVS (INDIA) LIMITED INFORMATION MEMORANDUM ...

WABCO-TVS (INDIA) LIMITED INFORMATION MEMORANDUM
4. The Company has 17,544 members as on the date of filing the Information Memorandum.
V. OBJECTS OF THE SCHEME:
1. SCL was incorporated in 1962 with an initial paid up equity capital of Rs.82
lakhs of which 51% was contributed by the TVS Group and 49% was
contributed by CDH. The primary businesses of SCL were (a) Brakes Business
and (b) Non-Brakes Business.
2. SCL offered its shares to the public through a prospectus and from October
1983, the shareholding pattern of SCL has been as follows:
Particulars Shareholding %
TVS Group 40.83
CDH 39.17
Public shareholders 20.00
The shares of SCL are listed and regularly traded on the Stock Exchanges.
3. The TVS Group has been diversifying the operations of SCL by investing in the
manufacture of two wheelers and computer peripherals.
4. CDH is an indirectly wholly owned subsidiary of WABCO Europe BVBA which is
in turn, an indirectly wholly owned subsidiary of WABCO Holdings Inc., one of
the world’s leading providers of electronic braking, stability, suspension and
transmission automation systems for heavy duty commercial vehicles, while the
TVS Group is a leading producer of automotive components, two-wheelers,
electronic hardware and major distributors of automotives and spare parts in
addition to operating goods transport and financial services.
5. Both Promoters of SCL, namely the TVS Group and CDH, were of the opinion
that the Brakes Business required focused attention as a separate entity to
make it more competitive under the present economic environment in view of
inter alia (a) the business opportunities available (b) the significant increase of
road and highway infrastructure and (c) regulations to be announced by the
Government for improved safety and environmental compliance.
6. The Brakes Business also required new and latest technology to maintain its
market leadership position and respond to the future needs of the Indian
commercial vehicle markets for enhanced braking and advanced safety and
performance systems and to improve its competitiveness against the recent
entry of globally positioned competitors and to develop future markets both in
India and overseas. On the other hand, the Non Brakes Business, especially
the foundry business comprised therein, required increased attention to
external operations and developing export markets.
7. Under the circumstances, the Company was promoted by SCL as its wholly
owned subsidiary with an authorized and paid-up capital of Rs.5,00,000/-
consisting of 1,00,000 Equity Shares with a view to demerge the Brakes
Business of SCL by the Scheme under sections 391 to 394 of the Act. The
Equity Shareholders and the equity shareholders of SCL approved the Scheme
unanimously and the Hon’ble High Court of Madras also sanctioned the Scheme
without any modification on 20 th February 2008.
8. The Scheme was approved with a view to achieve the business purposes and
objectives of, inter alia, enabling greater management focus on the respective
businesses of the two Promoters, permitting them to focus their resources on
their respective businesses, permitting independent decisions regarding the use
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