Calcutta, Nov. 2: The restructured North Indian Plantation Operations (Nipo) of Tata Tea Limited (TTL) is keen on an IPO as an exit route for its stakeholders, but not before two to three years of operations by which time the new company will be on firm foundations.

In the meantime, the new company hopes to finish the open offer to employees by March next year. It is expected all approvals for the formation of the new company will be in place by then.

“IPO is a logical exit point for our various stakeholders but would only be considered after we have built the business of the new company and achieved a certain amount of robust growth within the first two to three years of its operations,” Percy Siganporia, managing director, TTL, said here today.

He said the new company will initially operate from the city but will shift to Guwahati where TTL has moved its plantation operations five months ago.

The company will start operations from April 1, 2007 to coincide with the new season from the middle of March. IL&FS, IFC and Tata Tea are set to pick up 20 per cent each in the company, while the shareholding of GMS is still unknown.

A Tata company might also pick up a stake in the new entity, Siganporia said, declining to name the company.

“While we have said that our stake would be around 20 per cent, it will depend on the extent of employee participation. So we want to keep it flexible till the details have been worked out completely,” Siganporia added.

The workers and the staff will get an interest free loan to buy shares payable fortnightly or monthly over seven years, with the monthly instalment not exceeding 10 per cent of their wages.

The debt equity ratio of the restructured Nipo will be 1:1 or even less, which Siganporia said is much less than many companies in the industry.

In the meantime, Tata Tea is set to diversify into fisheries and ginger cropping in Assam, while it has applied for permission to diversify in Bengal in areas other than tea tourism.

Branded tea launch

To improve the wellness quotient of the drinkers, Tata Tea is set to launch the country’s first branded green tea bag, the second company to offer the beverage after Hindustan Lever which offers branded green tea only in Kashmir.