The decision by the loss-making Mumbai unit of Hindustan Organic Chemicals Limited (HOCL), HOCL-Rasayani, to sell its 442 acres of land to BPCL has come as a boon to the HOCL-Kochi unit as the latter will be getting a pie from the sales proceedings.
The deal assumes significance in the wake of the Union Budget turning a blind eye towards HOCL.
The amount will be sufficient for the Kochi unit to repay its debt of Rs 120 crore to BPCL-Kochi Refinery. The sale will also clear the way for HOCL-Kochi to merge with BPCL-Kochi.
HOCL-Kochi, which had been making profit, slipped into loss after the profit earned here was invested in the loss-making Mumbai unit.
“A meeting of the audit committee and board of directors of HOCL will be held on February 8 to discuss sale of the Rasayani land to BPCL and 20 acres of land and machinery to the ISRO. The meeting will also conduct a valuation of HOCL’s assets. The final decision on the matters is subject to shareholders’ consent,” said the company in a report submitted to stock exchanges.
Last week, BPCL had made a proposal to buy the land for Rs 1.3 crore/acre with certain conditions, including proper title deed and removal of encroachments.
“The deal will benefit HOCL-Kochi as we would be able to clear our debts. The amount raised through the sale of land will be utilised to offer VRS to some employees of HOCL-Rasayani,” said HOCL Joint Action Council member Shaji R.
HOCL-Kochi is situated on 120 acres of land at Ambalamugal and employs 550 persons, including 337 permanent employees. There are also over 100 pensioners. According to a valuation carried out by SBI in 2015, HOCL-Kochi is worth Rs 500 crore.
Source: New Indian Express