SPIC to wind up subsidiaries in Mauritius, Dubai

Project did not materialise due to non-allocation of gas; subsidiary's assets later seized by Dubai's free zone authorities

Southern Petrochemicals Industries Corporation Limited (SPIC) has decided to wind up SPIC Fertilizers and Chemicals Ltd, its wholly-owned subsidiary in Mauritius as well as its step-down subsidiary SPIC Fertilizers and Chemicals FZE (SFC FZE), Dubai.

The Board of Directors, in a meeting held November 6, 2015, approved the commencement of the winding up process, subject to regulatory clearances. Full provision has been made for the investments held in this subsidiary in earlier years, according to company's announcement to BSE.

According to company's 2014-15 Annual Report, company's investments included Rs 184.53 crore in equity share capital of SFCL (Mauritius), which had invested in SFC FZE, Dubai to produce ammonia and urea in the Jebel Ali Free Zone, Dubai.

However, since the project did not materialise due to non-allocation of gas, SFC FZE had commenced dismantling the existing plant and machinery with a view to relocate to a location where assured gas supply could be obtained.

The company also said Jebel Ali Free Zone Authorities (JAFZA) had taken over the assets of SFC FZE, Dubai, the holding company SFCL Mauritius lost control over the subsidiary.

The combined share of the company and its subsidiary in SFC FZE Dubai is 83.54%. As assets of SFC, FZE Dubai were taken over by JAFZA, SFCL, Mauritius lost control over its subsidiary.