Haldia Petrochemical Ltd. (HPL), one of East India's biggest success stories in the manufacturing sector, seems to be at loggerheads with the West Bengal government. The Bengal government - major stakeholder in HPL, has indicated unwillingness to be party to the bid by HPL to acquire Basell Polyolefins. In fact the Bengal government would oppose participation in the Basell deal. The reason seems to be spelt out clearly- this participation goes against the objective of the state government to promote development of the state. Though the state government in principle is not against the participation of HPL or its bid to become a global player in the petrochemicals industry- but the state does not want to be a part of the deal.
Discussions have been initiated by the government with HPL's promoter, The Chatterjee Group (TCG), for disposing its stake in HPL. The state would decide on its withdrawal from HPL on the basis of the price offered by TCG. Currently, TCG holds shares worth Rs 568 crore in Rs 1410 paid up equity in Haldia Petrochemicals through two companies, Chatterjee Petroleum Mauritius and Chatterjee Petroleum India. It also holds another Rs 260 crore in HPL equity through some other associates. The total holding comes out to be around 52%. After restructuring of HPL's debt, TCG's holding would go up to around 56% and the financial institutions would hold around 8%t per cent of HPL's equity.
After the debt restructuring, the state governments holding would go down from 38% to 35%.
20-Jun-05 
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