Nocil preferential allotment to Shell okayed

MUMBAI, Oct 31: National Organic Chemicals Ltd (Nocil) shareholders today approved the issue of 8.24 crore shares in Nocil Petrochemicals Lt...

MUMBAI, Oct 31: National Organic Chemicals Ltd (Nocil) shareholders today approved the issue of 8.24 crore shares in Nocil Petrochemicals Ltd to Anglo-Dutch major Shell and its wholly-owned subsidiary Montell for a price not less than Rs 29 per share on a preferential basis.

A resolution to this effect has been passed unanimously at the extra ordinary general meeting of the Nocil shareholders here on Saturday.

Speaking at the EGM, Nocil chairman Arvind Mafatlal said the issue price is likely to go up to Rs 35 per share due to probable reduction in the restructuring expenses of the company.

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Since the price is fixed for the 70 per cent of the company’s business, the notional share price works out to Rs 40 per share for Rs 29 and more than Rs 50 per share if the price goes up to Rs 35, he added. The company will soon obtain the Mumbai high court approval for the demerger of the company into three. A senior Nocil official told the Financial Express that an EGM will be convened by December-end for theapproval for the de-merger scheme.

Answering shareholders’ query on the post-demerger share split ratio, Mafatlals said the ratio will approximately be in the ratio of 70:16:14 for petrochemicals, rubber chemicals and the residual company. However, exact split ratio will be determined on the recommendations of the auditors, he added. Shell and Montell will pick up 49 per cent in the demerged petrochemical entity.

The company will evolve a scheme in consultations with the Bombay Stock Exchange to take care of the odd lots generated at the time of share splitting, he added. Shell and Montell, will work together with Nocil to complete the modernisation project, which has been partially implemented by the company at its manufacturing site in Maharashtra. The company proposes to modernise the naphtha cracker, which will substantially increased the capacities of ethylene and propylene.

H1 profit falls sharply to Rs 2 cr

MUMBAI: The net profit of National Organic Chemicals Industries Ltd (NOCIL) hasdropped to Rs 2.36 crore during the half year ended September 1998 from Rs 23.40 crore the same period last year. Net sales amounted to Rs 534.06 crore (Rs 511.98 crore) and earned a lower gross profit of Rs 12.21 crore (Rs 32.52 crore).