The buzz of Indian Oil Corporation being interested in Haldia Petrochemicals Ltd (HPL) has been there for quite some time, but today IOC Chairman R S Butola officially indicated his interest in the eastern India’s biggest petrochemical company.
IndianOil already has a 8.89 per cent stake in HPL by virtue of a Rs 150-crore (Rs 1.5-billion) investment made in 2004.
The West Bengal government, which holds close to 40 per cent stake in HPL, has started its share sale drill and has appointed Delloite India to execute the divestment plan and a valuation process is going on.
Delloite India is expected to file its report by March.
“IndianOil has its Haldia refinery, which has been supplying naptha to HPL.
"There is some synergy. And it is for everybody to see whether this synergy suits or not.
"We think it might suit. We will take a decision at an appropriate time,” said Butola.
It may be noted that a team from IOC had met HPL chairman Partha Chaterjee in May last year.
However, TCG chief, Purnendu Chatterjee , a majority shareholder in HPL, will have the first right of refusal once the final auction price is decided.
Meanwhile, the lead bankers have denied the promoters’ request to extend any further capital to the ailing petrochem firm.
HPL is suffering Rs 50-60 crore (Rs 500-600 million) of cash loss every month and it is in desperate need for non-interest bearing funds of Rs 1,000 crore (Rs 10 billion).
HPL has defaulted on working capital loan.
Company chairman, who is also the state industries minister, has now asked the state government to infuse Rs 100 crore (Rs 1 billion) at the earliest.