The Hindu : Reliance completes acquisition

Online edition of India's National Newspaper
Wednesday, Jun 05, 2002

Business

Business

Reliance completes acquisition

By Our Special Correspondent

NEW DELHI JUNE 4. Reliance Industries Ltd (RIL) today formally took charge of the managerial control of IPCL after handing over a cheque for Rs. 1,490.84 crores to the Government for acquisition of the 26 per cent stake.

Immediately the new management sought to dispel the fear of market abuse on account of the group virtually acquiring the monopoly status in the petrochemical sector.

The management maintained that the products were freely traded.

Signing of the agreement marked the conclusion of the disinvestment process of IPCL with the parties subsequently exchanging shareholders' agreement, guarantee agreement and transfer restriction agreement which were part of the other formalities involved in the deal.

The RIL executive director, Nikhil Meswani, who delivered the cheque to Ashok Chawla, Joint Secretary in the Petrochemicals Ministry, after the formal agreement signing ceremony between the Government and the corporate house finally clinching the share transaction.

Reliance, the country's one of the petrochemical giants, said it would continue to focus on the domestic market and do everything possible to elevate and bring IPCL at par with international standards. "IPCL is a well run company and we will supplement resources in terms of technology and human capital,'' Mr. Meswani asserted while speaking to the mediapersons even as he declined to divulge details of forthcoming investments saying that it was little to premature to talk about it.

Reacting to fears of a possible misuse of monopoly status, he said this was a myth and added that every single product was freely traded.

In any case, acquisition of India's second largest petrochemical company IPCL would in no way lead to absolute monopoly in any of product lines, he said.

Observing that IPCL's two gas-based cracker plants at Nagathone and Gandhar and the Naptha-based complex in Baroda would have surplus capacity, Mr. Meswani said, "we will continue to grow to bring petrochemical consumption in India to world levels.''

Asked if Reliance was interested in acquiring a stake in Haldia Petrochemicals, he said there was no such proposal.

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