Recast plan

Calcutta, Dec. 19: Industrial Development Bank of India (IDBI) may consider Indian Oil’s investment proposal in Haldia Petrochemicals (HPL) as part of the corporate debt restructuring (CDR) package.

Talking to The Telegraph, senior IDBI officials dealing with HPL’s debt restructuring said, “We have received two investment proposals — one from Gail and the other from IOC. We will examine both the proposals before taking a final call. We would offer a proper package to HPL so that it can come out of the woods.”

The CDR cell will finalise the restructuring package within January 22.

IOC’s proposal seems to have appealed to the lenders. “IOC wants to bring in fresh equity of Rs 700 crore. Initially, we had asked the promoters of HPL to bring in this amount. More equity infusion will make the financials of the company healthier,” said financial institution sources.

The current proposal involves a package of Rs 5,700 crore, out of which Rs 700 crore would be in the form of sponsored equity by IOC, while the balance would come as separate investments in naphtha cracker and polymer unit expansion, styrene unit, condensate refinery, synthetic rubber unit and paraxylene unit.

IDBI had insisted that the promoters chip in more funds, but the HPL management had submitted a proposal to infuse Rs 468 crore of fresh equity.

Of this Rs 468 crore, Purnendu Chatterjee of The Chatterjee Group is supposed to put in Rs 268 crore fresh equity while the rest Rs 200 crore would come from Gail against a 10 per cent stake in HPL.

Officials of the Bengal commerce and industry department said: “The state government has no role to play as far as IOC’s proposal is concerned. The state government, as one of the promoters of HPL, has signed the debtor-promoter agreement at the CDR cell. They cannot do anything now. The onus is now on IDBI to decide whether IOC can be allowed to take over HPL.”

This was the second proposal that IOC had offered to Haldia Petrochemicals. The earlier proposal was shot down by the Bengal government due to opposition from the principal promoter Purnendu Chatterjee.

IOC had demanded management control in the company with a 26 per cent stake. Chatterjee opposed the proposal on the ground that HPL will become another government-owned company if IOC is allowed to acquire a 26 per cent stake.