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KOLKATA, March 20

IN an effort to enhance shareholder value and clean up the balance sheet, Phillips Carbon Black Ltd, an RPG group company, is examining the possibility of restructuring three of its loss-making subsidiaries. They could either be merged together or with the parent company.

This was announced by Mr Paras K. Chowdhary, Director, at the company's 41st annual general meeting, which was chaired by another Director, the noted industrialist, Mr B.M. Khaitan, in the absence of the Chairman, Mr Sanjiv Goenka.

The three subsidiaries of Phillips Carbon Black are: Transmission Holdings Ltd, South Asia Electricity Holdings Ltd and PCBL Industrial Finance Ltd.

For the year ended April 30, 2001, Transmission Holdings recorded a profit of Rs 3.79 lakh, but its total losses are Rs 39.07 lakh.

South Asia Electricity, for the year ended March 31, 2001, registered a loss of Rs 6.12 crore and its accumulated losses were Rs 22.15 crore.

During the same period, PCBL Industrial Finance's loss was Rs 75.10 lakh and its accumulated loss was Rs 54.49 crore.

Phillips Carbon Black on its own did fairly well. For the year ended September 30, 2001, the company registered a 20.44 per cent growth in sales to Rs 489.83 crore from Rs 406.03 crore of the previous year.

However, profit after tax dropped by 35.52 per cent to Rs 4.32 crore from Rs 6.70 crore.

According to Mr Chowdhary, during the current year, the company has been doing well and hoped that it would record a turnover of Rs 500 crore.

Minority shareholders said that the three subsidiaries are a burden on the parent company and they should be separated from Phillips Carbon Black.

Reacting to it, Mr Chowdhary said that the proposal is currently being examined.

"We are studying all sorts of possibilities. Either these companies will be merged into the parent or may be merged together to create a separate entity. We are examining the proposals and our ultimate aim is to enhance the shareholders' value,'' Mr Chowdhary told reporters after the meeting.

The issue of buyback was also raised by a shareholder, but Mr Chowdhary said that it is currently not being considered. Instead, he said that the company is trying its level best to reduce production cost by cutting down wastage and expenses on the energy front.

In this context, he also said that there is some scope for manpower reduction, but he could not give further details. Instead, he said that this aspect is also being studied by the management.

Couple of years ago, Phillips Carbon Black was considering units in China and Sri Lanka. However, till date, nothing has materialised.

Mr Chowdhary said that fresh studies are being conducted on the issue.

"We have not shelved those proposals yet,'' he said.

In July last year, the Kochi unit of Phillips Carbon Black was closed down due to a pollution problem. The plant has been reopened, but operating only at 40 per cent capacity. The director said that it will be increased slowly.

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