The Hindu : Business : HPL board to induct Godrej, Tata

Online edition of India's National Newspaper
Wednesday, Jul 21, 2004

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Business

HPL board to induct Godrej, Tata

By Our Special Correspondent

KOLKATA, JULY 20. Jamshyd Godrej and Ratan Tata are slated to join the board of Haldia Petrochemicals Ltd. (HPL), a joint sector company. The HPL Chairman, Tarun Das, said here today at a press meet that they would act as independent directors. The Tatas now have a 14 per cent stake in the company with the balance being held by Chatterjee Petrochem (Mauritius) and the West Bengal Government.

Mr. Das said the crucial corporate debt restructuring (CDR) of HPL was likely to be `effectuated' with an infusion of Rs. 143 crores which was being arranged by Purnendu Chatterjee of the Chatterjee group. An annual debt service burden of over Rs. 500 crores led to a heavy sagging of HPL's bottomline, although it was an operationally sound company and one of the latest petrochemicals plants in the world according to its Chief Executive Officer, Swapan Bhowmik. The debt burden was likely to be reduced to Rs. 400 crores once the CDR was in place.

HPL expected to get its 2003-04 financial results audited soon and was now eyeing a Rs. 100 crore net profit for the year. Mr. Das said HPL achieved a Rs. 4,298 crore turnover in 2003-04 against Rs. 2,957 crores in 2002-03. Its operational profit stood at Rs. 758 crores against Rs. 327 crores in the previous year.

Mr. Das also indicated that talks on the Gas Authority of India Ltd (GAIL) picking up fresh equity in HPL would be resumed once the CDR got under way. The CDR required HPL to get Rs. 600 crores of additional equity. This was expected to come through a mix of promoters' funds, infusion by GAIL as the fourth partner and through an initial public offering (IPO).

The HPL board that met here today took note of the preparation on the IPO which is slated to be completed by December. Mr. Das was not committed on the size, but said the process of selecting the merchant bankers was on. To a question, Dr. Chatterjee said post-CDR, his stake in HPL would increase from 43 to 50 per cent.

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