IDBI spikes Spic, TAC merger move
Lady luck seems to be playing truant with the AC Muthiah controlled Spic group of companies. Bearly six months after the group’s hopes to revive its jinxed petrochemical venture, Spic Petro, were dashed when the proposed suitor, Mangalore Refineries and Petrochemicals Ltd (MRPL), developed cold feet about the alliance, the Industrial Development Bank of India (IDBI), one of the key lenders to the group, had reportedly put a spoke on the wheels of its plans to amalgamate one of its subsidiaries Tuticorin Alkali Chemicals and Fertilisers (TAC) Ltd with its flagship company Southern Petrochemical Industries Corporation Ltd (Spic).
Board of directors of both companies had cleared the merger proposal a couple of months back. Spic holds 45.15% stake in TAC.
Sources in the financial circles told FE on conditions of anonimity that the proposed merger of Spic and TAC is likely to be called off soon as the IDBI led consortium of lenders are opposing the move. “IDBI has been opposing the move citing the fact that Spic has turned sick and is being referred to the BIFR following its networth erosion while TAC is in the process of a turaround and has started making profits,” sources said.
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