The Hindu Business Line : India Steamship to be merged with Chambal Fert

For every 20 equity shares held in ISS, as on reference date to be determined by CFCL, 11 equity shares of CFCL of face value of Rs 10 each shall be issued.

Kolkata , Sept. 16

INDIA Steamship Company (ISS) will cease to have a separate identity. The 76-year-old shipping company belonging to the K.K. Birla Group is being merged with Chambal Fertiliser & Chemicals Ltd (CFCL), also in the same group. This was decided at the ISS board meeting held in Delhi on Thursday. In all probability, ISS will survive as a shipping division of CFCL.

The ISS board resolved that the company, subject to the consent of shareholders and creditors, will undertake a scheme of arrangement and amalgamation among CFCL, the company, their respective shareholders and creditors in accordance with Section 391-394 of the Companies Act, 1956.

As per the scheme, for every 20 equity shares held in ISS, as on reference date to be determined by CFCL, 11 equity shares of CFCL of face value of Rs 10 each shall be issued. The appointed date under the scheme is September 1, 2004. With effect from the appointed date, the company shall be amalgamated with CFCL. Pursuant to such amalgamation, the company shall stand dissolved without being wound-up.

Company sources, however, feel that it will be several months before the actual merger will come into force. This is because there are so many formalities to be complied with such as approval of the High Court, consent of the shareholders and the approval of the Registrar of Companies.

The holders of 25,000 five per cent tax-free cumulative preference shares of the face value of Rs 100 each, being preference shareholders of ISS, shall be issued, in accordance with the scheme for each 5 per cent preference share, 10 preference shares by CFCL of the face value of Rs 10 each credited as fully paid-up on the same terms and conditions.

It might be recalled that Ratnakar Shipping, another K.K. Birla shipping company, was merged into ISS in 1990.

ISS has an equity capital of Rs 47. 53 crore subscribed in the following proportions: the promoters group 78.77 per cent, financial institutions and mutual funds 0.96 per cent, non-resident Indians and foreign nationals 0.08 per cent and Indian public 20.19 per cent.

Right now, ISS fleet totalling 246,773 dwt, consists of three ships, all crude carriers. These are "Ratna Abha", a 60,725-dwt Panamax tanker, "Ratna Shalini", 89,960 dwt Aframax tanker, and "Ratna Urvi", a 96,088 dwt Aframax tanker.

The company has a total of 68 shore-based staff — 13 officers, 23 staff and 22 sub-staff. The number of shipboard officers on roll is 44. Also, there are 297 ratings in company's roster in Kolkata.

In 2003-04, ISS posted a profit before tax of Rs 15.45 crore, againstRs 23.04 lakh in 2002-03, operating profit of Rs 27.86 crore (Rs 4.37 crore) and profit after tax of Rs 9.68 crore (Rs 1.18 crore). The accumulated loss amounted to more than Rs 18 crore.

More Stories on : Restructuring | Fertilisers

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page