Zuari Industries plans to bid for Paradeep Phosphate stake

Our Corporate Bureau

Mumbai, Jan 3: Zuari Industries Ltd has decided to submit its bid for the acquisition of a stake in Paradeep Phosphates Ltd (PPL), where the government is divesting its 74 per cent stake. The move is in line with the second-phase of disinvestment in PPL, wherein the government has invited financial bids from prospective bidders.

In a notice to the Bombay Stock Exchange, Zuari Industries has informed that the committee of directors appointed by the board of directors of the company at its meeting held on Thursday has decided to submit the price bid for the acquisition of stake in PPL.

Accordingly, the company has decided to convene an extra-ordinary general meeting (EGM) on January 29, 2002 for approval of investment not exceeding Rs 400 crore, pursuant to Section 372A of the Companies Act (1956) for acquisition of 74 per cent stake in PPL.

The board of Zuari Industries has already approved the acquisition of 74 per cent stake in PPL at its meeting held on October 30, 2001.

Earlier it has been reported that Oswal Chemicals and Fertilisers Ltd, Zuari Industries and Rashtriya Chemicals and Fertilisers (RCF) had put in their expression of interest to acquire a majority stake in PPL.

The Union government intends to induct a partner to hold 74 per cent equity in PPL. Deloitte Touch Tohmatsu India Pvt Ltd has been appointed advisors to assist the government in this exercise.

PPL’s paid up share capital is Rs 341.7 crore of which equity capital is Rs 224 crore and preferential capital is Rs 117.7 crore. Turnover for 1999-2000 stood at Rs 887.8 crore. The company is engaged in production of di-ammonium phosphate (DAP) and NPK fertilisers.

PPL has one of the largest DAP plants in Asia with a production capacity of 7,20,000 million tonnes per annum. It has also got the facilities to manufacture sulphuric acid, phosphoric acid and to generate captive power. PPL is planning for the expansion of its existing DAP plant. Consequently, the existing capacity of the phosphoric acid plant will be doubled. The company has also elaborate plans for tiding over the limitation of the mono-product (DAP)
by diversifying into ammonia-urea complex with 5,00,000 million tonnes of annual capacity each.