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Compaq to invest through Mauritius route

BS Corporate Bureau

US-based Compaq Computer Corporation has decided to route its equity investments in India through the Mauritius route.

The existing Indian subsidiary-Compaq Computer (India) Ltd, recently approached the Foreign Investment Promotion Board for transferring all except one equity share from the existing shareholders-CCC (99 per cent) and Compaq Computer International Corp, also of the US, (1 per cent)-to Compaq Computer Mauritius.

One equity share will be transferred to the Netherlands based Compaq Computer EMEA, BV.

As per the capital restructuring scheme, 100 per cent shareholding amounting to about Rs 885 million consisting of 8,84,67,320 equity shares of Rs 10 each in the paid up capital of the company will be subscribed by the group companies of CCC.

Of the total 8,75,82,647 shares held by CCC are being transferred to the Mauritius outfit, besides another 8,84,672 shares held by Compaq Computer International will follow suit.

One share of CCI was being transferred to CCEMEA (Netherlands).

Sources said that the company has stated in its application that this "capital restructuring was in line with its global restructuring plan".

The proposal was accompanied by a resolution of the board of directors of Compaq Computer India. The company was issued original foreign collaboration approval in March 1996 for setting up a subsidiary to assist in the sourcing of electronic components from manufacturers located in India for the use of Compaq units in various parts of the world and for import of fully assembled products for the purpose of marketing and sale in the Indian market.

The company was also permitted to provide after-sale support and services for Compaq products, provide maintenance support in India and elsewhere for Compaq products and undertake installation and maintenance of hardware and software systems in India, either directly or through joint venture companies. Most importantly, it had approval to manufacture and assemble computer hardware and related products.

Initially, Compaq had proposed an investment of Rs 4.5 million, which would be subsequently increased to Rs 22million. In July 1999, the share capital was increased to Rs 885 million, held largely by CCC.

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