labels: economy - general, balmer lawrie
Plans to hive Balmer Lawrie into four units news
Praveen Chandran
05 July 2002
Mumbai: The ministry of petroleum has mooted a cabinet note proposing the hiving off of four business units of Balmer Lawrie into separate subsidiaries before the sell-off.

The proposed business units are container freight stations, travel and tours, leather chemicals and tea-blending and exports divisions. Currently, Balmer Lawrie has nine different business units.

Initial bids were invited last Thursday for the sale of the government equity in the company as a whole. SBI Caps, advisors to the disinvestment ministry for privatising the company, invited the expression of interest (EoI) for selling the entire 61.8-per cent government equity in the company.

Balmer Lawrie was a subsidiary of IBP Ltd. Following the sale of IBP to Indian Oil Corporation the government share in the company was transferred to a new company called Balmer Lawrie Investments.

Sources close to the development say the petroleum ministry feels that Balmier Lawrie, with its core business units such as industrial packaging, grease and lubricants, project engineering and consultancy and logistics services, will fetch a better deal than including non-core business areas in the sale.

At the same time, the value of the four business units, if separated, will enhance as the entire assets and investments in these four business units of the company will be transferred into the proposed subsidiaries.

The sources add that the three loss-making divisions of Balmer Lawrie - freight containers, antioxidants and functional additives, and Oleo Chemicals - have already been closed down, and the restructuring idea mooted by the oil ministry was to see that Balmer Lawrie retains its core business with products and services related to the petroleum sectors.

The cabinet committee on disinvestment will take up the issue of Balmer Lawrie disinvestment in August 2002. The invitation for EoI says Indian companies, overseas corporate bodies and foreign companies having a net worth (excluding revaluation reserves) of over Rs 100 crore as on 31 March 2002 and consistently good business and management track record can bid for Balmer Lawrie by 2 August 2002.


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Plans to hive Balmer Lawrie into four units