Business   

Merger of units with holding firm sought

KANNUR: The Keltron Employees’ Organisation (KEO) has demanded merger of the four Keltron units in the district with the holding company, Kerala State Electronics Development Corporation (KSEDC).

In a representation to Industries Minister Elamaram Karim recently, KEO Kannur unit secretary K. Sundaran said that Keltron Component Complex Limited (KCCL), Keltron Chrystals Limited (KXL), Keltron Resistors Limited (KRL) and Keltron Magnetics Limited (KML) at Mangattuparamba here had been running in accumulated loss.

Liberalised import policy, additional interest on loans, price hike of raw materials and inefficiency of the managements of some of these units contributed to the crisis.

The KCCL could reduce the loss by half through implementing one-time settlement (OTS) two years ago, while the KML had started making running profit by implementing the OTS.

The Industries Minister’s announcement of the government’s decision to merge all the four units into one company had come when discussions were under way for implementing OTS in the KRL and the KXL, the representation said. Such a merger would be complicated and raise legal issues, it said. While all the shares of the KML, KRL and KXL were vested with the KSEDC and the government, the government and KSEDC’s stake in the KCCL was 51 per cent and private shareholders had 49 per cent stake.

As the four units were separate companies, each had separate director board and chief executives and prepare separate balance sheets and benefits given to workers in each were also different, Mr. Sundaran said.

He said the KCCL was not learnt to have convened its annual general body meeting and passed a resolution on the issue of the proposed amalgamation.

Though the company management had been urged to discuss legal issues involved in the proposed amalgamation, no steps were taken in this regard so far, he said.

The accumulated losses of the KCCL, KXL, KRL and the KML were Rs.12.50 crore, Rs.9.50 crore, Rs.3.25 crore and Rs.4.25 crore respectively.

Neither the KSEDC nor local management explained how the financial liability totalling Rs.39.50 crore in the wake of the merger of the four units would be settled.

Employees of the KXL had to be paid salary arrears for over seven months as the unit was in deep crisis.

There should be detailed discussion on retirement benefits of employees.

The KEO said the only solution to the problems facing the companies was merger of all the four units with the holding company.

That would pave the way for the merger of all Keltron units in the State into one institution.

Printer friendly page  
Send this article to Friends by E-Mail

Stories in this Section

More spectrum for broadband providers
Getting the green technology on the roads
Data Patterns in pact with Raytheon
Call to use corporate power to address eco issues
Merger of units with holding firm sought
Face-to-face programme
SriLankan Airlines launches package

Copyright © 2007, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu