Calcutta, Aug. 10: The Bengal government plans to puncture holes in Purnendu Chatterjee’s claim before the company law board (CLB) that The Chatterjee Group (TCG) is the majority shareholder in Haldia Petrochemicals.
While challenging the basis for Purnendu’s premise, the state government will build its argument around the fact that with the support of the Tatas and Indian Oil (IOC) it has a larger slice of the HPL stake pie.
Bengal government sources contended that even without the IOC stake of 7.5 per cent valued at Rs 150 crore, the other two partners would have a larger stake in the company than TCG and its associates.
Sources said the state, the Tatas and IOC together hold HPL shares worth Rs 870 crore, while TCG and its associate companies like Chatterjee Petrochem (Mauritius) Company, India Trade (Mauritius) and Winstar India Investment Company together hold shares worth just Rs 690 crore. As a consequence, the state government along with the Tatas and IOC hold 55.79 per cent stake in HPL.
Last Friday, the CLB passed an interim order restraining the government from issuing fresh shares to domestic financial institutions on the ground that this would turn TCG’s holding in HPL into a minority stake. The government said Purnendu’s claim is both audacious and bogus.
However, CLB chairman S. Balasubramanian did not stay the allocation of HPL shares to IOC on the ground that TCG would continue to hold a majority 53 per cent stake in HPL.
Sources say TCG is basing its calculation on an agreement it signed with the state government on January 12, 2002 under which the latter said it would hand over shares worth Rs 155 crore to TCG.
TCG was to make the payment over a 15-year period. On the completion of the payment, shares would be transferred to TCG making it the majority shareholder.
Government sources claimed that the share transfer had not taken place as TCG reneged on a July 31 payment deadline and, therefore, its claim that it held a majority stake was clearly untenable.
Sources also contested Purnendu’s claim that by offering the shares to IOC at the face value of Rs 10, HPL would stand to lose Rs 300 crore.
Chatterjee had contended that he was asked to pay close to Rs 30 per share while it was being offered to IOC at Rs 10.
“IOC was offered shares according to the corporate debt restructuring package. The financial institutions are allowed to swap debt to equity at par under the CDR package. So the question of a premium does not arise,” state government sources said.
They also pointed to the fact that Winstar India Investment Company Ltd ' an entity that Purnendu had roped in last year to meet the CDR commitment ' had also been offered shares at the face value of Rs 10 each.
At the next hearing on September 27 and 28, the state will raise these points. It will also produce documents to prove that IOC’s entry was done with the full knowledge of the HPL board, including Purnendu.