CLB reserves order on issue of HPL share allotment to IDBI

25-Jan-06

The company law board (CLB) reserved an order on the issue of allotting 135 crore shares to IDBI by The Chatterjee Group (TCG) in the Haldia Petrochemicals Limited (HPL) case, after considering the submissions made by Chatterjee Petroleum Mauritius Company (CPMC). IDBI is the principal lender of the consortium of 52 institutions who had lent money to the company that has a total debt at around Rs 3,000 crore. CPMC has contended that further allotment of shares to IDBI according to the corporate debt restructuring package, would make CPMC a minority stakeholder. The structure of the company will change and HPL will become a government company. Hence the matter of allotment of shares to IDBI cannot be taken in isolation because it would have a direct bearing on the shareholding and nature of ownership of the company. The IDBI counsel contended that according to the CDR agreement and subsequent resolution of the company, the financial institution should be allotted shares and the injunction was unfair.