A journey into entrepreneurship
Matchmaker, investment banker, entrepreneur. That, in a nutshell, is Keshav Kantamneni, who has just bought a ₹170-crore wood panel manufacturer.
When Uniply Industries gave Globality Partners, a financial advisory firm headed by Kantamneni, the job of finding a buyer, the entrepreneur in him woke up. Realising the potential of the BSE-listed company, Kantamneni decided to make a bid for the firm in his individual capacity.
The 32-year-old, a product of the Kellogg School of Management, requested the Globality team to exclude him from the transaction, and “started doing the math to buy it myself”.
From then on, everything happened in quick succession in the ₹126-crore deal, including appointing D&A Financial Services as his merchant banker, announcing his plans to the stock exchange last week, and coming out with an open offer to buy up to 45 lakh shares, representing 26 per cent of equity capital of Uniply.
He made an offer of ₹13.50 for a share of ₹10 face value. Kantamneni acquired the promoters’ holding of 36 per cent, held by BL Bengani and others, for ₹2.5 crore.
In addition the company owed banks ₹55 crore, and other creditors ₹50 crore, which he will have to bear.
Uniply has three factories in Chennai. The company closed 2013-14 with a turnover of Rs. 172 crore. Kantamneni, who is using his own funds for the transaction, has big plans for this maker of ply, wooden panels and doors. He plans to add value to Uniply’s existing business and strengthening supply chain linkages.
He targets more acquisitions. “So, you can expect another announcement from me,” he says with a wink.
After reading this article in Feb 2015, it was clear that a smart management has acquired this company and it’s going to have good time lead by young promoter.
Uniply to sell plywood division to UV Boards
Uniply Industries is reorganising its business structure to scale up its presence in the gamut of construction business. It is selling its plywood division to its subsidiary UV Boards as part of a ₹300-crore deal that will take Uniply’s holding in the subsidiary to 37 per cent from the present 8 per cent.
The transaction involves UV Boards issuing shares worth ₹111 crore to Uniply, acquiring for ₹42 crore Uniply’s Gujarat facility and paying ₹75 crore for licence to use Uniply’s trademark, which will be paid equally over 10 years, in advance at the start of the year. The balance will be a consideration of ₹72 crore.
The balance in UV Boards’ stake prior to the transaction and subsequently is held by public shareholders.
Uniply will focus on design and build projects where it now has a ₹1,050-crore order book that it hopes to scale up significantly.
The decision was taken at Uniply’s board meeting today, said Keshav Kantamneni, Chairman and Managing Director. This strategy will deleverage its consolidated balance sheet. Over ₹145 crore of debt of Uniply and its other subsidiary Vector Projects will be paid off.
Uniply, along with Vector Projects, an architecture, design and interior fit out company, will handle large projects in commercial and residential space from designing to fully furnished spaces including electrical and plumbing works.
Also, Uniply will be an asset light entity delivering greater return on capital and value, he said.
As of now Uniply’s construction order book spans residential and commercial space across Maharashtra, Karnataka, Telengana, Tamil Nadu and Delhi. Its marquee clients include Goldman Sachs, TCS, JP Morgan and the Telangana government.
The current management team of Uniply’s plywood business headed by Srinivasan Sethuraman and Ramesh Malpani will be integrated into that of UV Boards and financial results of UV Boards consolidated into that of Uniply on closing of this transaction, he said.