Restructuring of Hindustan Organic Chemicals approved -Governance Now

Restructuring of Hindustan Organic Chemicals approved

Operations of Rasayani unit of HOCL would be shut down, except Di-Nitrogen Tetroxide (N2O4) plant

GN Bureau | May 19, 2017

#Hindustan Organic Chemicals #PSU #restructuring #cabinet #ISRO

The cabinet committee on economic affairs has approved a restructuring plan for Hindustan Organic Chemicals Ltd. (HOCL), a loss making central public sector enterprise under the department of chemicals and petrochemicals.

The enterprise, having units at Rasayani (Maharashtra) and Kochi (Kerala), has been making continuous losses since 2011-12, resulting in acute shortage of working capital. “A majority of its plants have remained shut down during the last few years. It could not pay regular salary and statutory dues to the employees since February, 2015,” a PIB release said.

According to the plan, operations of all the non-viable plants at Rasayani unit of HOCL would be shut down except Di-Nitrogen Tetroxide (N2O4) plant which would be transferred to ISRO.

The N2O4 plant is of strategic importance as it is the only indigenous source of N2O4 which is used as liquid rocket propellant by ISRO in the space launch vehicles.

Financial implications of the plan is Rs 1,008.67 crore which is to be met partly from sale of 442 acres HOCL land at Rasayani to Bharat Petroleum Corporation Ltd (Rs 618.80 crore) and remaining (Rs 365.26 crore) through bridge loan from the government.

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