Financial restructuring of Bharat Bhari Udyog Nigam Ltd and transfer of administrative control of its subsidiaries Burn Standard Company Ltd and Braithwaite & Co Ltd to Ministry of Railways and transfer of refractory unit of Burn Standard Company Ltd to Steel Authority of India Ltd
The Cabinet Committee on Economic Affairs today approved the proposal of financial restructuring of Bharat Bhari Udyog Nigam Ltd (BBUNL), transfer of administrative control of its subsidiaries Burn Standard Company Ltd (BSCL) and Braithwaite & Co Ltd to Ministry of Railways, transfer of Refractory unit of BSCL at Salem to Steel Authority of India Ltd (SAIL) and merger of another subsidiary the Braithwaite, Burn and Jessop Construction Co Ltd and the BBUNL.
This involves an expenditure of Rs 1139.16 crore as Non Financial assistance crore by waiving off of Government of India Loan and interest of Burn Standard Company and financial assistance of Rs 14.15 crore to the Burn Standard Company.
As a part of financial restructuring of the Burn Standard Company Ltd, a Plan loan of Rs 31.70 crore, a Non-Plan loan of Rs 350.82 crore given by GOI and Zero Rate Debenture of Rs 75.03 crore given by GOI as on 31.12.2009 will be converted into equity and subsequently the equity will be reduced by Rs. 457.55 crore with a corresponding reduction in accumulated losses. The Plan loan, Non-Plan loan of Rs 28.16 crore and Zero Rate Debenture of Rs 14.30 crore given by GOI to subsidiaries of Burn Standard Company as on 31.03.2009 will be converted into equity and subsequently the equity will be reduced by Rs. 42.46 crore with a corresponding reduction in accumulated losses. Government will provide Rs. 14.16 crore Non-Plan fund in the form of equity for discharging current statutory liabilities as on 31.03.2009. Normal and penal interest of Burn Standard Company on the Gol loan of Rs.639.15 crore as on 31.03.2009 will be waived and no further interest would be levied beyond the cut off date of 31.03.2009.
Transfer of wagon making companies to the Railways will help the companies to become commercially viable as this would resolve a basic problem being faced by them. Upon transfer to Steel Authority of India Ltd, the Salem refractory unit of Burn Standard Company unit will have access to funds for modernization and capacity expansion.
Burn Standard Company Ltd has 1418 employees and Braithwaite and Company ltd has 459 employees. Improvement of the financial performance of these companies will improve the compensation to the workmen and contribute to further economic development of the areas in West Bengal and Tamil Nadu where these units are located.
The Cabinet Committee on Economic Affairs today approved the proposal of financial restructuring of Bharat Bhari Udyog Nigam Ltd (BBUNL), transfer of administrative control of its subsidiaries Burn Standard Company Ltd (BSCL) and Braithwaite & Co Ltd to Ministry of Railways, transfer of Refractory unit of BSCL at Salem to Steel Authority of India Ltd (SAIL) and merger of another subsidiary the Braithwaite, Burn and Jessop Construction Co Ltd and the BBUNL.
This involves an expenditure of Rs 1139.16 crore as Non Financial assistance crore by waiving off of Government of India Loan and interest of Burn Standard Company and financial assistance of Rs 14.15 crore to the Burn Standard Company.
As a part of financial restructuring of the Burn Standard Company Ltd, a Plan loan of Rs 31.70 crore, a Non-Plan loan of Rs 350.82 crore given by GOI and Zero Rate Debenture of Rs 75.03 crore given by GOI as on 31.12.2009 will be converted into equity and subsequently the equity will be reduced by Rs. 457.55 crore with a corresponding reduction in accumulated losses. The Plan loan, Non-Plan loan of Rs 28.16 crore and Zero Rate Debenture of Rs 14.30 crore given by GOI to subsidiaries of Burn Standard Company as on 31.03.2009 will be converted into equity and subsequently the equity will be reduced by Rs. 42.46 crore with a corresponding reduction in accumulated losses. Government will provide Rs. 14.16 crore Non-Plan fund in the form of equity for discharging current statutory liabilities as on 31.03.2009. Normal and penal interest of Burn Standard Company on the Gol loan of Rs.639.15 crore as on 31.03.2009 will be waived and no further interest would be levied beyond the cut off date of 31.03.2009.
Transfer of wagon making companies to the Railways will help the companies to become commercially viable as this would resolve a basic problem being faced by them. Upon transfer to Steel Authority of India Ltd, the Salem refractory unit of Burn Standard Company unit will have access to funds for modernization and capacity expansion.
Burn Standard Company Ltd has 1418 employees and Braithwaite and Company ltd has 459 employees. Improvement of the financial performance of these companies will improve the compensation to the workmen and contribute to further economic development of the areas in West Bengal and Tamil Nadu where these units are located.
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