IFCI recast: Ministry yet to decide on future course

The finance ministry is yet to make up its mind on the future course for IFCI. Though the ministry has restructured the liabilities of the f...

The finance ministry is yet to make up its mind on the future course for IFCI. Though the ministry has restructured the liabilities of the financial institutions (FIs) to the tune of Rs 1,500 crore from other FIs and banks, no decision has been taken on the future of the institution and the method of lendings which IFCI should follow.

In the meantime, the government has also given an extension of six months to the present chairman and managing director of IFCI V.P. Singh implying that the government is also not contemplating any change of guards at the top helm of the FI.

SC clears Pfizer merger with Parke-Davis

NEW DELHI: DRUGMAKER giant Pfizer Ltd will go ahead with its merger with pharma major Parke-Davis (India) Ltd following Supreme Court’s approval to their amalgamation scheme on Monday. The apex court dismissed the special leave petition (SLP) filed by dissenting shareholders and approved the merger of Parke-Davis with Pfizer Ltd. ‘‘Pfizer will now proceed to complete the implementation of the scheme of amalgamation with Parke-Davis,’’ the pharma company said. The company will now take steps to issue equity shares of Pfizer Ltd in the proportion of 4 equity shares for every 9 equity shares of Parke-Davis (India) Ltd. Pfizer will also proceed to hold the AGM to approve the annual accounts of the company for the year ended November 30, 2002. PTI

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Finance ministry sources pointed out that the ministry is yet undecided on whether to merge IFCI with a leading bank or FI or allow it to exist on its own with a thrust on the small scale and medium sector enterprises.

The other options before the government is of course to rope in a strategic partner. Sources, however, pointed out that the top most priority for the finance ministry at present in the process of corporatisation of IDBI.

The Parliamentary Standing Committee had raised some issues on the process of corporatisation of IDBI which are being inducted through amendments in the process of corporatisation.

Talking to The Indian Express, the chairman and managing director of IFCI V.P. Singh said that “on its own part the FI is going ahead with restructuring process ie diversifying its activities to fee based activities. We have two major issues pending on the restructuring process. The restructuring of the liabilities of EPFO and the final touches to the assets reconstruction company (ARC) would be final issues on the restructuring process”.

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According to the IFCI chief, the offered rate of 9 per cent to EPFO is good considering the present low interest rate regime. On the ARC front the FI is awaiting the final nod of RBI. The ARC would be instrumental in bringing down the NPA level of FI which still stood at around Rs 4,000 crore. However, it would not be easy for the ARC to dispose of the assets which has been transferred to it by the FI. The FI is working on the issue, Singh added. After these two crucial process, IFCI should be able to stand on its own. The other options of inducting a strategic partner or merger with other FIs or banks could be looked into after the internal restructuring is over, FI sources said.

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