Paradip Phosphate Bidders Start Due-Dilligence Process

The bidders for public sector Paradip Phosphates Ltd (PPL), which is put on the block for disinvestment, have initiated the process of due dilligence through visits to the plant site evenas the employees Union has intensified its agitation against the sale of the unit. According to Pravat Samantray, MP and president of the PPL Employees Union, four parties have responded to the "show of interest" bid invited by the Centre earlier this year. They are Chambal Fertiliser, a Birla group company, the public sector Rashtriya Chemicals and Fertilisers , Oswal Chemicals and Fertilisers and Southern Petrochemical Industries Corporation.

Of these, the officials of Chambal Fertiliser, along with the representatives of Morocco based Office-Cherifien des Phosphates (OCP), a major raw material suppliers to the fertiliser industry in India, visited the Paradip site of PPL for an on-the-spot assessment of the unit last week. Another group of officers from RCF is in Orissa now to make a similar study.

 

Meanwhile, a team from Deloitte Touche Tohmatsu India Pvt Ltd, the global advisor to the Union government for PPL disinvestment, is deputed to the headquarters of PPL in Bhubaneswar to assist the interested parties in the due dilligence studies. This process of plant visits by the parties will continue till the third week of September before they participate in the commercial bid for the unit, said a senior official of the company.

The government of India has announced its intention to disinvest upto 74 per cent in PPL whose net worth has become negative after sustaining accumulated losses to the tune of Rs 500 crore. The company had earlier submitted a Rs 400 crore financial restructuring scheme (FRS) to the Centre envisaging conversion of govenrment loan into equity and waiver of interest in a bid to turnaround its fortunes. But the Centre only approved partial FRS for the company allowing waiver of interest to the tune of Rs 129 crore in March this year.