While Ricoh seems to be doing well globally, in India, it suffered a massive disruption several years ago, due to poor governance. The Japan-based company’s Indian subsidiary Ricoh India Limited was quoted on the Bombay Stock Exchange, and despite the Japanese parent company pumping in cash, Ricoh India Limited went into insolvency. It filed an application under Section 10 of the IBC before the National Company Law Tribunal in March 2018, as it was unable to meet its liabilities.
The Mumbai bench of NCLT vide its order dated 28 November 2019 approved the resolution plan submitted by the Resolution Applicants. It meant acquisition of the company by the resolution applicants, Kalpraj Dharamshi and Ms. Rekha Jhunjhunwala, who made an open offer of Rs 50 per share to 26.4% of the shareholders and to delist the company as per the approved plan.
The public announcement of the plan dated 2 December 2019, in several daily papers reads: “As an integral part of the Approved Plan, the Resolution Applicants intend to provide an exit opportunity to the Public Shareholders of the company by making an offer to acquire up to 1,04,97,791 Equity Shares of Rs. 10/- each at a price of Rs. 50/- per equity share, representing 26.40% of the paid-up equity share capital from the Eligible Shareholders and consequently delist the Company from BSE Limited (“BSE”) as provided in the Approved Plan.”
The good news
The good news is that the acquired and to be delisted company has an active product line up from its parent Ricoh in the digital press area, and the Indian company should be back in the distribution and sales of digital print production presses in the next year. A new CEO has been appointed with a track record in the digital press business. We believe that the investors are also familiar with the digital print business, having been associated in the past, with companies importing and selling digital presses.
Ricoh has a significant installed base of sheetfed digital presses in India and a few webfed inkjet presses. It should come as a relief to its customers that maintenance and toner inputs will continue from a forward-looking business. Ricoh has an excellent line-up of webfed inkjet presses and has been lauded as a leader in the segment, primarily because of its VC70000 press. One expects to see a strong showing from the company at drupa 2020 in June, and for Ricoh’s Indian customers, it will come as a relief. For potential customers, it will come as a welcome option once the company becomes both locally viable and responsive.