Tata Chemicals Merges With Hind Lever Chem

Updated: Jan 26 2003, 05:30am hrs
TATA group company Tata Chemicals has merged with Hind Lever Chemicals (HLCL) to form the largest bulk chemicals and fertilisers entity with a turnover of more than Rs 2,500 crore. The boards of the two companies met on Friday and decided the swap ratio at 5:2. That means, for every 2 shares of Hind Lever Chemicals held, its shareholders would get 5 shares of Tata Chem following the merger. HLL held 50 per cent equity in HLCL while Tatas held 29.85 per cent equity in Tata chemicals Ltd as on December 31,2002.

This merger according to observers is driven by two factors. First, though both the companies derive the bulk of their revenues from similar businesses, their product portfolios are complimentary to each other, with almost no overlap. Secondly, with the retention-pricing scheme for urea set to be replaced by a flat group price for subsidy computation, traditional differences between the urea and phosphatic fertiliser businesses are set to disappear.

GOLD
War Rhetoric Sends Prices Zooming

Gold prices have touched an all-time high of Rs 5,840 per 10 gm in Delhi as London prices per 10 gm zoomed to a six-year high of $360 per troy ounce due to the increased chances of the US attacking Iraq. Indians queued up to sell the metal. During the week various bullion markets found eager sellers. For instance, Mumbais Zaveri Bazaar was full of people wanting to sell gold. On the other hand, a few buyers preferred to exchange old ornaments rather than purchase additional gold at the prevailing prices as local prices touched an all time high of Rs 5,840

The spurt in gold price has encouraged miners to increase investments and raise productivity, but at the same restrict hedging till the trend reverses.

OBITUARY
Harivansh Rai Bachchan Dead

Literary legend Harivansh Rai Bachchan passed away on January 19. In a literary career spanning more than 50 years, Bachchan captured the imagination of readers and continued to hold it with an unbroken series.

Born in Allahabad on November 27, 1907, Bachchan had his early education there and at the Allahabad University and Benaras Hindu University. He then taught at the Allahabad University before moving to Cambridge for further studies. On his return, he worked in various capacities in All India Radio and the External Affairs Ministry. His famous works are Madhushalal and Kya Bhoolun Kya Yaad Karoon (his biography in four parts).

DISINVESTMENT
House Approval Not Needed For Oil PSU Sell Off

The attorney general (AG), Soli Sorabjee, has said that Parliamentary approval was not required for disinvestment in oil PSUsHPCL and BPCL.

The AGs opinion implies that the Union Government would not have to amend the relevant Acts through which these companies were acquired and nationalised before privatising them.

The opinion of AG is positive. Work on disinvestment in HPCL and BPCL would now move forward, ministry sources said.

The government had decided in early December to privatise HPCL through the strategic sale route and opt for public offer of shares for disinvestment in BPCL.

But a meeting of the Cabinet Committee on Disinvestment held on December 27 to finalise the modalities for the privatisation of these two oil entities decided to put off a decision in this regard for want of an opinion from the AG

LOW RATES
Debt Recast Plan For Steel Firms Cleared

On Tuesday, the corporate debt restructuring forum of financial institutions (FIs) and banks approved a revamp of about Rs 20,000 crore debt of three major steel makersEssar Steel Ltd, Ispat Industries Ltd, and Jindal Vijaynagar Steel Ltd. The package includes reduction in interest rates and writing down promoters equity steps that would help them bring down costs and accelerate payback, bankers said. According to the plan, the lenders will pare an average rate of interest by about 4-4.5 per cent and equity will be written down 40 per cent. Jindal has an equity base of about Rs 1,350 crore, Ispats equity is 685 crore, and that of Essar stands at Rs 330 crore.