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Ratan Tata requested to rejoin Haldia Petro board

Bhupesh Bhandari in New Delhi

Haldia Petrochemicals chairman Tarun Das has requested Ratan Tata to re-join the company's board of directors. Tata, along with Shyamal Gupta of Tata International, had stepped down from the Haldia Petrochemicals board after the Tata Group had decided to exit from the venture by selling its 14 per cent stake to the West Bengal government.

"We want the Tatas to stay with the company and I have requested Ratan Tata to join the board of directors again," Tarun Das told Business Standard.

The Rs 6,000-crore (RS 60-billion) Haldia Petrochemicals is a 43:43:14 joint venture between the West Bengal Industrial Development Corporation, the Chatterjee-Soros Group, and the Tatas.

As per the joint venture agreement, if the Tata group decides to bow out of the venture, WBIDC will pick up its 14 per cent sake.

Ratan Tata had first announced at the Tata Engineering annual general meeting last year that the group would sell its 14 per cent stake in Haldia Petrochemicals because petrochemicals did not fit into the group's business portfolio.

Tarun Das also said the restructuring package for Haldia Petrochemicals was ready, including the conversion of part of the debt into equity, increasing the share capital of the company to Rs 1,100 crore (Rs 11 billion), while reducing the stake of the Tata group from 14 per cent to 8.87 per cent. Haldia Petrochemicals is expected to turn profitable once the capital restructuring is over.

The Tata group had initially invested in Haldia Petrochemicals through Tata Chemicals. Later, the stake was transferred to group firms Tata Power and Tata Engineering.

Given the fact that none of these two companies has interest in petrochemicals, there has been speculation that the stake may be transferred to the closely-held group company, Tata Sons.

Tarun Das also confirmed that the proposed deal with Indian Oil Corporation, by which the firm was supposed to pick up a minority stake in Haldia Petrochemicals, was off.

The public sector oil major had wanted management control in return for the investment, something that did not work out.

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