Ballarpur buys RI company

Ballarpur buys RI company

BOMBAY (Dow Jones): India's largest paper maker, Ballarpur Industries Ltd., has signed an agreement with Indonesian conglomerate Sinar Mas to buy its Indian unit, Sinar Mas Pulp & Paper (India) Ltd., a source at Sinar Mas India told Dow Jones Newswires Wednesday.

"We have signed certain documents in Singapore, and Ballarpur has paid some money into an escrow account," the source said.

An escrow account is a third-party bank account in which money is deposited by the buyer till the formalities of the sale agreement are over.

The source declined to say how much money Ballarpur has paid so far or how much the total sale consideration is.

Local media have reported that Ballarpur will buy the unit at 5 billion rupees (about US$107 million) from the Indonesian conglomerate, which is facing financial difficulties.

Sinar Mas India has a paper factory in the western state of Maharashtra with a production capacity of 150,000-metric tons a year.