Tata Tea to retain holdings in restructured operations

Tata Tea to retain holdings in restructured operations
Comment E-mail Print Share
First Published: Tue, Apr 03 2007. 07 29 PM IST
Updated: Tue, Apr 03 2007. 07 29 PM IST
Kolkata: In a bid to instill confidence among employees and workers in proposed Amalgamations Plantations Pvt Ltd (APPL), Tata Tea said on 3 April it would play a ‘mentoring’ role and continue to retain strategic holdings in the restructured operations.
Tata Tea managing director Percy Siganporia said that it was not the intention of the company to exit the tea business. The restructuring exercise was started with a view to usher in ‘social transformation’ in the estates both in north and south India.
While the south Indian assets had been transferred to Kanan Devan Hill Plantations, Tata Tea’s holding in it was just over 19%. The company would hold almost a similar percentage in APPL, the new look firm after restructuring of the north Indian operations.
Besides Tata Tea, the other equity participants were IFC (20%), IL&FS (20%), Globally Managed Services (GMS) at nearly 12%, Tata Investments (15%) and employees between 18-23%.
Siganporia said that while the response from the employees and workers in Assam was very positive, that from the West Bengal estates was not that encouraging.
Tata Tea has already communicated the intention behind the restructuring to all the four major trade unions in West Bengal, namely Chah Bagan Mazdoor Union, National Union of Plantation Workers, WBTGEA and WB Cha Mazdoor Sabha.
Siganporia said that all the investors including IFC, GMS, and IL&FS were not short-term investors and were committed to the cause.
Tata Tea has nearly 31,000 permanent workers and employees on its rolls in Assam and West Bengal.
Shares were issued to IFC and IL&FS at Rs10 at par value each, while the paid-up capital of APPL would be in the region between Rs150-175 crore.
Siganporia said that the transaction process was yet to be completed and transition would take effect from 1 April 2007 after obtaining all the clearances.
The company had also arranged to provide soft loans to the workers to help them in subscribing to the shares of the APPL.
Tata Tea would also maintain the referral hospital at Chubwa and the workers would get all the statutory benefits, he added.
Comment E-mail Print Share
First Published: Tue, Apr 03 2007. 07 29 PM IST
More Topics: Corporate News | Sector Spotlight |