Tata Tea announce divestment plans
Twenty tea estates in Assam and four in West Bengal will fall under the new corporate entity, the name of which is yet to be finalised, he said.
By PTI |
GUWAHATI: Tata Tea Limited on Tuesday announced plans to hive off its North India Plantation Operations (NIPO) in Assam and West Bengal into a new corporate entity from April one, 2007.
The need for divestment was felt as an alternative because of high costs, low labour productivity, decreasing yield and ageing tea bushes and was not due to insurgency problem in Assam and frequent extortion bids, NIPO vice president Deepankar Borah told a press conference here.
Twenty tea estates in Assam and four in West Bengal will fall under the new corporate entity, the name of which is yet to be finalised, he said.
Terming the decision as a landmark move for the tea industry, Borah said, the new corporate body, the head office of which would be shifted from Kolkata to Guwahati, will have 21 per cent of employees share in the equity while the parent Tata Tea Limited would have a 20 per cent share.
The remaining equity would be held by strategic developmental partners including the International Finance Corporation (IFC) of Washington, for whom it would the first investment in the tea sector, Infrastructure Leasing and Finance Services (IL & FS) and Global Management Services (GMS), Borah said.
The enterprise would not only concentrate on tea as the main crop but will also aggressively diversify into other cash crops, Borah said.
Start a SIP with as low as ₹500 with ET Money App!
Download
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
The Economic Times News App for Quarterly Results, Latest News in ITR, Business, Share Market, Live Sensex News & More.
ADVERTISEMENT
