• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources

Group Sites

• The Hindu
• Business Line
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

G.K. Nair

Kochi , Oct. 12

THE Housing and Urban Development Corporation (Hudco) is understood to have decided to convert Rs 52 crore outstanding against Cochin International Airport Ltd (CIAL) into its equity in the airport company, and in that event, it will pour cold water on the latter's latest plan to go for a rights issue to cover this amount.

Confirming that the issue has come up, Hudco sources told Business Line on Monday that the Hudco Chairman and Managing Director would visit the State probably next week to hold discussions with the CIAL Chairman and its directors in this connection.

The Hudco Chief is on the Board of Directors of the airport company.

Under a one-time settlement over a year ago with Hudco, the major financer of the airport project, CIAL, had repaid Rs 120 crore out of the total outstanding dues of Rs 172 crore and set aside Rs 52 crore for converting into its equity.

However, the indecision of the corporation for long and the shareholders' continued insistence not to allot the equity at Rs 10 per share to Hudco had compelled the company's board of directors to decide (at its meeting on September 10) to allot shares worth this amount among its 10,000 shareholders as a rights issue. A sub-committee was also constituted for this purpose, CIAL sources said.

The State Government is holding 26 per equity of the company and hence the public shareholders are unhappy over the Central Government institution (Hudco) taking another 26 per cent share in the company, which claims to be the first-ever international airport in the private sector in the country.

According to them, to facilitate the rights issue, CIAL had remitted Rs 52 crore to Hudco recently towards final settlement of the loan liability. But, the corporation is understood to have not accepted the payment and instead told CIAL that it was interested in converting this loan part into equity of the company, a source said.

The airport company, which had been in the red ever since it was commissioned in June 1999, had for the first time posted a net profit of Rs 12.54 crore in 2002-03. This went up to Rs 22.11 crore last fiscal. It declared a dividend of 8 per cent.

More Stories on : Rights Issue | Airlines

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

Stories in this Section
Amara Raja bags Maruti order

Copyright © 2004, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line