CLB upholds allotment to IOC in Haldia Petro

CLB has rejected the plea of the Purnendu Chatterjee group to restrain IOC from claiming 7.5% ownership.

In its interim order, the Company Law Board (CLB) today rejected the plea of the Purnendu Chatterjee group to restrain Indian Oil Corporation from claiming ownership of 7.5 per cent equity issued in Haldia Petrochemicals.

As a consequence of the order, any conversion of IDBI's debt into equity will have to wait for the law board's final order as it has directed Haldia Petrochemicals to defer allotment of any further shares till the disposal of the petition.

All the shareholders are to maintain status quo on their holdings till the final order is given.

"Even though no interim order has been passed against IndianOil, yet the shareholding is subject to the final order," S Balasubramanium, chairman, CLB, said in his order.

With 15 crore shares, IndianOil gets one director on the board of Haldia Petrochemicals. The Chatterjee group has four directors on the 16-member board.

The CLB declined the Chatterjee group's contention that the Rs 150 crore paid by IndianOil for its stake be kept in a separate account, and noted that keeping such a large amount without use would not be in the interest of the company.

While passing the order, the CLB took note of the fact that even after the allotment of the 7.5 per cent stake to IndianOil, the Chatterjee group would continue to hold a majority 53 per cent shares in the company.

Further issue of shares has been deferred, taking into account the Chatterjee group's apprehension that allotment of shares to lenders of Rs 135 crore equity at par in terms of the corporate debt restructuring (CDR) package will put the group into a minority.

Haldia Petrochemicals, West Bengal Industrial Development Corporation and the West Bengal Government have been directed to file their replies before August 25 and rejoinders, if any, before September 10. The case will come up for hearing on September 27-28.