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Aditya Birla Chemicals, Nirma & others complete due diligence for Punjab Alkalies

Aditya Birla Chemicals (India) Pvt Ltd, Nirma Ltd and Punjab-based Kudos Chemie Ltd and a consortium led by Al Shemail, the four qualified bidders for the proposed 44.26 per cent equity stake sale by Punjab State Industrial Development Corporation Ltd (PSIDC) in Punjab Alkalies & Chemicals Ltd (PACL), have reported on the dates to carry out the due diligence, as per a stock market disclosure.

While Punjab's Kudos Chemie, Ahmedabad-based Nirma Ltd and UAE-based garment manufacturer Al Shemail consortium reported for due diligence on October 28, Aditya Birla Chemicals did it on October 29.

Based on the current market cap the stake is valued at around Rs 45 crore. Apart from PSIDC, foreign institutional investors hold 0.02 per cent stake in PACL, domestic institutional investors 0.10 per cent while 55.62 is held by others, as on June 30, 2014.

This is the fourth time PSIDC is undertaking the dilution process. Previously in 2002, the company had initiated the process to dilute stake in PACL but no company showed interest in purchasing the stake. Thereafter, it tried in 2005, which again could not happen due to change of government. The third attempt was in 2010 when the state government received only one bid.

IFCI Limited is acting as a global advisor for the proposed disinvestment by PSIDC.

PACL is engaged in the manufacture and sale of caustic soda (lye & flakes), liquid chlorine, hydrochloric acid, sodium hypochlorite and hydrogen gas. It is one of the largest manufacturers of caustic soda in India, with an installed capacity of about 99,000 tonnes per annum (tpa).

For the fiscal ended on March 31, 2014, the company reported revenue of Rs 267.43 crore as against Rs 288.99 crore in the previous fiscal. The company posted a net loss of Rs 9.57 crore in the fiscal compared with a net profit of Rs 2.81 crore in the year-ago period.

On Wednesday, shares of the company were trading at Rs 51 per share, up 1.59 per cent at 1.49 PM on the BSE in a strong Mumbai market.

(Edited by Joby Puthuparampil Johnson)

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