HLL takes control of Modern Foods

NEW DELHI, JAN. 31. The Government today formally handed over Modern Food Industries to Hindustan Lever Ltd. (HLL) by formally signing a shareholders' agreement that envisages transfer of 74 per cent Government stake and management control of Modern Foods to the fast moving consumer goods giant.

The shareholders' agreement was signed by Mr. Gunender Kapur, HLL's head of foods division, and Mr. K K Gupta, Joint Secretary in the Department of Food Processing under the agriculture ministry here. HLL also made an upfront payment of Rs. 105.45 crores to the Government for securing 74 per cent equity in the popular public sector bread manufacturing company. The signing of the shareholders' agreement between HLL and Government is a sequel to the Cabinet decision last week approving sale of 74 per cent stake in Modern Foods to the FMCG major.

HLL would also infuse a fresh equity of Rs. 20 crores into Modern Foods in such a way that would restrict the former's shareholding in the company to 74 per cent.``The sell-off in Modern Foods amply demonstrates the Government's commitment to get out of non- strategic areas and the need to usher in professional handling in such ventures," the Secretary, Department of Disinvestment, Mr. Pradeep Baijal, said.

- PTI

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