All assets, liabilities and debts relating to the cement business vest with Grasim, the two group companies said today in separate statements issued after their respective boards took on record the transfer scheme.

In line with the scheme, Grasim will issue three equity shares for every 10 equity shares to Indian Rayon shareholders. The GDR holders of Indian Rayon will receive corresponding GDR in Grasim.

The transfer of cement business has rendered Indian Rayon's debt-equity ratio almost negligible as debts amounting to Rs 437 crore stand transferred and an amount of Rs 232 crore of debt was pre-paid in the current year.

The merger has been approved by shareholders of both the companies as well as the high courts of Gujarat and Madhya Pradesh. The merger enhances Grasim's cement capacityto 10.7 million tonnes inclusive of that of its subsidiary Shree Digvijay Cement and 0.9 million tonne under implementation at Redipallayam in Tamil Nadu.

In view of the demerger, Indian Rayon accounts for 1998-99 have been recasted by excluding the cement divisions' working for the period September 1998-March 1999.

Indian Rayon's restated results show a net profit of Rs 106 crore for 1998-99 and the board of directors have recommended a dividend of 40 per cent which would result in an outgo of Rs 26.99 crore.