South Asian Petrochem Ltd to merge with Dhunseri Industries

KOLKATA: South Asian Petrochem Ltd is all set to merge with Dhunseri Tea & Industries. A meeting of board of directors has been called on December 15 to decide on the swap ratio and to work out the modalities of the merger.

In a notice send to the Bombay Stock Exchange, South Asian Petrochem said: "A meeting of the board of directors of the company will be held on December 15, 2009, to consider a scheme of arrangement comprising, inter alia amalgamation of the company with Dhunseri Tea and Industries Ltd."

SAPL, in which Dhunseri Tea & Industries along with its associates enjoy a 55.91% stake, was floated in 1999. SAPL started commercial production in 2003 at its Haldia factory in 2003. The company manufactures 2 lakh tonnes of PET resin using state-of-the-art technology from Zimmer AG of Germany. The plant at Haldia, whcih spreads over some 35 acres, also has a 12 MW captive power plant.

When contacted, C.K. Dhanuka. chairman of Dhunseri Group said: "The swap ratio is being worked out by a consultant. We cannot comment on it now. The merger will help us to control cost and in better management. Post-merger, Dhunseri Tea & Industries will have two separate divisions - tea and petrochem."

The South Asian Petrochem stock was trading at Rs.15.09, up by 8.95% at the BSE. The stock hit an intraday high of Rs.16 and low of Rs.13.75.The total traded quantity was 969,313 compared to the 2-week average of 72,064.

Mr Dhanuka further informed that after the merger, Dhunseri Tea & Industries will pursue the plan for setting 1,200 tonne per day Pet resin plant in Egypt. "We have received a number of clearances for the Egypt plant and, therefore, we have plans to set up the plant there," added Mr Dhanuka.