Board may consider rights issue to raise funds to bail out Haldia Petrochem

18-Dec-13

The board of Haldia Petrochemicals may discuss raising funds through a Rs 1,300 crore rights issue at its meeting. Each share in the proposed issue will be priced at Rs 25.10 apiece, matching the quote offered by Indian Oil in October to buy the Bengal government’s stake, as per Telegraphindia. Though the West Bengal Industrial Development Corporation, financial institutions and Indian Oil Corporation are in favour of such a proposal, it is likely to be opposed by The Chatterjee Group, the private shareholder of the firm. However, a simple majority in the board meeting will be good enough to pass the resolution. The rights issue, if approved, will be the first after HPL went into commercial production in 2001. If subscribed in full by all the stakeholders, it would not alter the company’s present shareholding pattern, under dispute at present. Indian Oil emerged as the only valid bidder for WBIDC’s stake, which includes the 15.5-crore-block and another relatively undisputed 52 crore shares, offering Rs 25.10 apiece. It valued the government’s holding at around Rs 1,700 crore.