National Organic Chemical Industries has been registered as a sick industrial company by the Board of Industrial and Financial Reconstruction.
This comes more than a month after Nocil's board approved the revised financial restructuring proposal of the company and also the signing of memorandum of understanding with a business associate of Reliance Industries, Sunbright Cement Agencies to sell its petrochemicals and plastic products division.
Under the restructuring proposal, the Nocil board, on January 7, approved the transfer of assets of petrochemicals division and the business undertaking of the plastic products division as a going concern and certain liabilities of the company to Nocil Petrochemicals Ltd, a wholly owned subsidiary of Nocil.
The assets pertaining to rubber chemicals division and certain liabilities will remain with existing Nocil. Sunbright will invest in equity of NPL after the process of demerger is completed.
Nocil has already closed down its petrochemical division after it received permission from the commissioner of labour on August 30, 2002.
In May 2002, it had offered a voluntary retirement scheme to all its employees working in the petrochemical division.
During the quarter ended June 30, 2002, the company posted a net loss of Rs 27.35 crore (Rs 723.5 million) compared with net loss off Rs 13 crore in the same quarter ended June 3, 2001.
The total income (net of excise) declined from Rs 203 crore (Rs 2.3 billion) for the quarter ended June 30, 2001, to Rs 104.56 crore (Rs 1.04 billion) in the same quarter of the previous year.
Nocil has a total petrochemicals capacity of 300,000 tonnes per annum, which includes an ethylene cracker of 80,000 tpa, value-added chemicals of 90,000 tpa, and fibre intermediates at 20,000 tpa.In addition, the petrochemical complex has a polymer capacity of 80,000 tpa. The plastics products division at Akola, Maharashtra, has a capacity of about 10,000 tonnes per annum of processed polymer products.