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May 20, 2002 | 1140 IST
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IPCL workers upbeat over selloff

Joydeep Ray

More than 14,000 workers and employees of the Vadodara-based Indian Petrochemicals Corporation are expected to enjoy new opportunities as members of the Reliance family. This follows the Centre's nod to sell a 26 per cent stake in IPCL to the Reliance.

The proposed acquisition is expected to provide benefits to employees of IPCL as well as its shareholders.

"There will be a splash of glamour in our identification now as earlier we used to boast of being attached with the Central government but now we will also be with one of the giants in the industry," said Manoj Shukla, a senior employee of IPCL on Sunday.

"For us, this Monday will be a new day and leading to a newer life, though being in an old structure," commented another IPCL employee. Meanwhile, Reliance officials also are proud here to add another feather in their cap.

Now the combination of IPCL and Reliance will help all concerned with new opportunities and a brighter future ahead, they said.

This is obvious as far as demonstrated track record of consistent operational and financial performance of Reliance is concerned, claimed company officials here on Sunday, a day after the divestment.

Customers and the downstream industry will benefit from access to wider product range and improved supply chain management, said a Reliance official.

"IPCL will benefit from Reliance's financial engineering skills, its ability to access capital at the most competitive terms and to optimise financial costs," said market analysts.

IPCL will also enjoy the full benefits of Reliance's strong relationships with customers, technology and equipment suppliers, and other constituents, in the domestic and international markets. The acquisition by Reliance will further provide an impetus to IPCL's growth plans, they added.

Calling it a vantage position for both the companies, an analyst said, "The IPCL acquisition will further enhance Reliance's market leadership in all its major products. IPCL's cost competitiveness will enhance Reliance's ability to capture world markets and service the global customer base."

Reliance and IPCL will have naphtha-fed crackers at Hazira and Vadodara and gas-fed crackers at Gandhar and Nagothane, providing competitive advantage in terms of feedstock and product mix flexibility.

Reliance produces naphtha, which is a feedstock for IPCL. Reliance is also engaged in exploration for oil and gas, which could potentially lead to greater feedstock integration between Reliance and IPCL.

With increased availability and a wider range of products, Reliance will be able to service the market even more effectively, leading to improved customer satisfaction.

In a statement following Reliance's successful bid to acquire IPCL, Anil D Ambani, managing director, Reliance Industries Ltd, said: "We are delighted to have emerged as the highest bidder for acquiring IPCL, through a fair and transparent process of global competitive bidding."

"The completion of the IPCL divestment by the government of India will mark a new milestone in the government's public sector units divestment programme, and will carry forward the process of economic reforms in the country. We are happy that Reliance has had the opportunity to play a role, and to contribute substantial value, in this process," he said.

"We take this opportunity to welcome IPCL's shareholders and employees to the Reliance family, and look forward to working closely with each of them in the endeavour to achieve future growth, and to maximise value for Reliance and IPCL," he added.

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