The Cabinet Committee on Economic Affairs on Wednesday approved the closure of Hindustan Fluorocarbons Ltd (HFL) and shutting down its operations to ward off future risks and liabilities.
"With the unviable scale of operations, very old plants and technology, and only one revenue-earning product (HCFC-22) but of no strategic significance, the sustainable revival of HFL is not economically viable," said an official statement.
The financial implications of closure involve providing support of Rs 77.20 crore to the company in the form of an interest-free loan for settling closure related liabilities.
HFL is a subsidiary company of Hindustan Organic Chemicals Ltd (HOCL), a Central public sector enterprise under the administrative control of the Department of Chemicals and Petrochemicals.
The company has been making losses since 2013-14 and has a negative net worth. As on March 31 last year, it had accumulated losses of Rs 62.81 crore and net worth of minus Rs 43.20 crore.
The statement said that closure of HFL will not only avoid any future risks and liabilities but also protect the interest and welfare of its employees by separating them through voluntary retirement scheme and voluntary separation scheme.
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Disposal of the company's land assets will enable their redeployment for more productive use which can attract both domestic and foreign investments, the statement said.
"However, interest and welfare of employees rendered surplus will be protected by payment of all their outstanding salary and statutory dues as per guidelines of the Department of Public Enterprises," it added.
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