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Punjab Cabinet decides to disinvest PSIDC stake in PACL

Press Trust of India  |  Chandigarh 

The Punjab Cabinet on Monday decided to disinvest PSIDC's stake in Punjab Alkalies and Chemicals Limited (PACL), a move which is expected to generate around Rs 50 crore.

The amount realised from the move would be utilised to pay debt of Punjab State Industrial Development Corporation (PSIDC), an official spokesperson said after the Cabinet meeting, held under the chairmanship of Chief Minister Amarinder Singh here.

"In a move expected to generate around Rs 50 crore, the Punjab government has decided to disinvest 90,90,000 shares of PSIDC in PACL," the spokesperson said.

The company, a major manufacturer of caustic soda and liquid chlorine, has been incurring heavy losses since 2009-10, with its net worth going in the red.

The Board for Industrial and Financial Reconstruction (BIFR) registered PACL's reference as sick industrial company under section 15 (1) of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA), the spokesperson said.

PSIDC had invested a sum of Rs 30.45 crore into equity capital of PACL by way of initial public issue and rights issue (subscribed on premium).

The equity share holding of PSIDC in PACL was around 42 per cent, which has now reduced to around 33.49 per cent due to restructuring of debt liabilities of financial institutions and public sector banks.

The Directorate of Disinvestment would initiate the process of disinvestment of PACL, a public limited company formed under the Companies Act, 1956, which commenced operations in January 1984 at two manufacturing units located at Naya Nangal and Rupnagar, the spokesperson informed.

The Directorate of Disinvestment had earlier made four attempts for disinvestments of PSIDC's equity stake in PACL in 2002-03, 2004-06, 2009-11 and 2012-15.

However, none of these attempts could succeed, the spokesperson said.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, September 16 2019. 15:15 IST