The Hindu Business Line : `Reliance, IPCL merger likely only after next June'

THE possibility of a merger between Reliance Industries Ltd and Indian Petrochemicals Corporation Ltd (IPCL) can be considered only after June 4, 2005.

Stating this, Mr J.B. Kamat, Senior Executive Vice-President of IPCL, said that as per the share purchase agreement signed between Reliance Industries and the Government, IPCL would have a Government shareholding and a director on its board for three years from the date of acquisition by Reliance Industries i.e. June 4, 2002. Reliance Industries, through its subsidiary Reliance Petroinvestments Ltd, has a 46 per cent holding in IPCL (through Government's divestment of 26 per cent holding in June 2002 and an open offer for additional 20 per cent two months later). After the completion of the current issue which envisages divestment of 29 per cent of the Government's holding, the Government would still have a five per cent stake which would be offered to the 13,000 employees who were on the rolls of IPCL in June 2002, with the Government retaining just a single share. Only after this is divested, the merger issue could be considered, Mr Kamat said. On the issue of Reliance Industries continuing to use the IPCL brand name while marketing its products, he said that this would continue since the use of brand name was linked with process technologies. Marketing of products took place through the combined network of Reliance Industries and IPCL and product grades were optimised through a linear programming model.

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