Purnendu Chatterjee is open to an out-of-court deal with the West Bengal government to end the ownership dispute over Haldia Petrochemicals Ltd (HPL). Currently the two main promoters of HPL are locked in a high stake legal battle in the Supreme Court to resolve who will eventually own and manage the company. The call for “amicable settlement” comes at from the owner of The Chatterjee Group (TCG), which has a 36.45% stake in HPL. Despite investing Rs 822 crore in HPL, TCG has not received any returns due to lack of dividends paid by the company so far. After two years of losses since 2001, HPL swung to profits, but reported loss again in 2008-09. The past fiscal is also likely to end in a loss because of the production shutdown for 5 months due to an expansion project. Also, TCG’s woes are compounded as it has a limited say in the management and operation of the company, currently under the control of the state government. In 2002 and 2005, the state agreed to hand over the control to Purnendu, but did not honor the deals. An out-of-court settlement could result in TCG becoming the largest shareholder and getting management control. This is possible in two ways: the government registers Rs 155 crore worth of preference shares with TCG, hiking TCG’s holding to 51%, and/or the state sells its holding partially or fully to Purnendu. All efforts in this direction over the past 2-3 years have been hindered by the inability of the two to agree to the company valuation as the process has not yet been initiated.
12-Apr-10 
{{comment.DateTimeStampDisplay}}
{{comment.Comments}}