Mitsubishi Chemical sells majority stake in MCPI to The Chatterjee Group

Kolkata, July 27 (IANS) Japanese chemical major Mitsubishi Chemical Corporation (MCC) on Wednesday signed a share purchase agreement with The Chatterjee Group for sale of its majority stake in its Indian subsidiary MCC PTA India Corp Pvt Ltd (MCPI).

According to agreement, MCPI will retain a minority portion of shares to facilitate technical and operational support on mutually advantageous terms.

"Mitsubishi Chemical Holdings Corporation (MCHC), the holding company of MCC, in its board meeting held on Wednesday in Tokyo passed a resolution to transfer controlling equity interest of MCC's Purified Terephthalic Acid (PTA) manufacturing subsidiary in India, the MCPI," said a MCPI statement.

The MCHC Board has approved the transfer of majority shares held by MCC in MCPI to Purnendu Chatterjee led The Chatterjee Group, while retaining a minority portion, the statement said.

In the resolution transfer of equity interest in MCC's China PTA and Poly Tetramethylene Ether Glycol (PTMG) businesses being carried out by Ningbo Mitsubishi Chemical Co Ltd. (NMC) and MCC Advanced Polymers Ningbo Co Ltd (MAP) to another company have also been authorised, the company said.

Formed in 1997, MCPI produces PTA, a raw material for polyester, at its Haldia plant in West Bengal with a present installed capacity of 1.27 million tonnes per annum.

Owing to severe market conditions MCPI became a 'sick unit' in April 2013 and has subsequently been referred to the Board for Industrial and Financial Reconstruction.

The company's main problem is the substantial amount of debt it has incurred, the huge accumulated loss and its continuance as a 'sick unit' under BIFR, it said in a statement.