Financial Daily from THE HINDU group of publications
Tuesday, Apr 09, 2002
Financial Daily from THE HINDU group of publications Tuesday, Apr 09, 2002 |
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Money & Banking
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Public Sector Banks Industry & Economy - Disinvestment Corpn Bank move on Ruia Cotex may hit Jessop sale Our Bureau
KOLKATA, April 8 THE sale of the engineering PSU Jessop to Ruia Cotex, which now under a stay order of the Calcutta High Court, seems to be heading for another road block, with the Corporation Bank planning to write to the Disinvestment Commission and the Reserve Bank of India on the unpaid loans of the textile company. The board of Corporation Bank, at its 269th meeting expressed "fears of possible diversion of funds'', while directing the bank for initiating steps for "immediate recovery of its loans''. Describing Ruia Cotex as an irregular borrower, the board noted that the company was now bidding for a company like Jessop besides planning fresh investments. Incidentally, Mr Tarakeswar Chakraborty, General Secretary of the All-India Bank Employees Association, has already sought the intervention of the Prime Minister to stop the sale of 74 per cent of Government's equity in Jessop to Ruia Cotex - a company which owes Rs 11 crore to Corporation Bank and Rs 15 crore to IDBI. Meanwhile, the stay order against the sale comes up for hearing on April 11, while the matter regarding the suspension by the Jessop management, of Mr Alok Brahmachari, the joint convenor of the Forum of Jessop Employees (which was spearheading the protest against the sale), comes up for hearing on April 9.
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