Six chemical and fertiliser companies have submitted their expressions of interest (EoIs) for the government’s 32.61 per cent stake in Hindustan Organic Chemicals Ltd (HOCL).
These companies, said industry sources, are Chambal Fertilizers and Chemicals, Vam Organic Chemicals, Schenectady India, Atul Ltd of Lalbhai Group, Deepak Fertilisers and Petrochemicals and Rashtriya Chemicals and Fertilisers.
The government of India intends to divest part of its shareholding in HOCL, amounting to 32.61 per cent along with the management control in the disinvestment process.
While individually the companies could not be reached, top industry sources confirmed the development. When contacted, both HOCL and AF Ferguson & Co, declined to comment on the issue. Earlier, it had been reported that Deepak Fertilisers and Petrochemicals had put in an EoI for acquiring the government’s stake in HOCL.
As per the eligibility criteria stated in the EoIs, companies, consortiums of companies or joint ventures interested in acquiring shares in HOCL, would be required to have a combined turnover in excess of Rs 250 crore.
The government has appointed AF Ferguson & Co as the advisor in connection with the proposed sale. HOCL is one of the leading manufacturers of organic chemicals and petrochemicals. The company’s products include phenol, acetone, aniline, nitroaromatics, chlorobenzene, acetanilide, formaldehyde and various by products. The company has two production units in Rasayani and Cochin.
After passing through a bad period, the company has made significant improvement in both topline and bottomline, adopting growth oriented strategies.
In spite of the recessionary trends in the chemical industry, the company has achieved a sales turnover of Rs 407.86 crore. With various cost reduction measures in the year 2000-01, the company has registered an operating profit of Rs 40.18 crore as against the operating loss of Rs 6.29 crore posted in the previous fiscal. One of HOCL’s major achievements in reducing cost has been the implementation of the voluntary retirement scheme (VRS) through which the company has curtailed manpower significantly.