The Hindu Business Line : Sultan of Brunei is SPIC's partner in Jordan venture

Southern Petrochemical Industries Corporation (SPIC) sees the sale of its partner's stake in Indo-Jordan Chemicals Company to the Brunei Investment Agency as a good augury for itself.

"It is good for us," Mr A.C. Muthiah, Chairman, SPIC, told Business Line on Friday. "The Sultan of Brunei will be our partner," he observed.

Indo-Jordan Chemicals Company is a joint venture of SPIC (52 per cent), Jordan Phosphate Mines Company (37 per cent) and The Arab Investment Company (11 per cent).

Jordan Govt stake sale

Jordan Phosphate Mines was owned by the Government of Jordan. Last week, the Jordan Government sold 37 per cent stake in this company to the Brunei Investment Agency, retaining another 25.6 per cent. (Jordan laws require the Government to hold at least 25 per cent in mining firms, which are considered national assets.)

Jordan Phosphate Mines Company has mining rights to over 1 billion tonnes rock phosphate reserves in Jordan, sources say. The company is said to be in financial trouble.

SPIC had in 2002 announced its intention to sell off its stake in the joint venture, Indo-Jordan Chemicals Company and had mandated Rabo Bank to look for a buyer. The fertiliser co-operative, IFFCO, came into the picture and for some time looked set to buy out SPIC, but that did not happen. Sources say SPIC wanted more than IFFCO's offer.

Indo-Jordan Chemicals' phosphoric acid plant was set up in the mid-1990s at a cost of $170 million. In 2004-05, the company made a profit of $4 million.

SPIC, which is under `Corporate Debt Restructuring' scheme of banks, has to find resources to pay back its debt and disinvestment in Indo-Jordan was seen as one of the ways of raising such resources.

On whether SPIC would ask Brunei Investment Agency if it would buy SPIC's stake in Indo-Jordan Chemicals Company, Mr Muthiah said, "We will have to wait and see how it goes."

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