Mahindra Automotive Steels Ltd has informed BSE that pursuant to a Scheme of Arrangement between the Company and Amforge Industries Ltd (AFL), the Chakan unit of AFL was demerged as a going concern together with all the assets and liabilities and was transferred to and vested in the Company with effect from April 01, 2005. The said scheme was sanctioned by the High Court at Bombay on March 21, 2006. As a result of the above AFL now does not undertake any activity in relation to forgings of the nature earlier undertaken by it at the Chakan Unit. AFL however still undertakes certain types of forgings of small parts and those in relation to two wheeler vehicles at its other units. Subsequent to the demerger, AFL and the promoters of AFL have agreed to enter into Non-Compete Agreements with the Company agreeing not carry on business in respect of forging product parts/components in all forms (raw, semi finished, finished, machined etc) used in automobiles, other than those used in two wheeler vehicles and certain other specific parts which are presently manufactured by AFL at its facilities at Bhandup and Chinchwad. The Non _ Compete Agreements are for a period of 7 years and consideration paid is Rs 2 Crores to AFL and Rs 3 Crores to promoters.