The Prime Minister AB Vajpayee has assured the employees union of the public sector pharmaceutical company Hindustan Antibiotics that the company will not be closed down as it was proposed by the Board for Industrial Finance and Reconstruction (BIFR). The Hindustan Mazdur Sangh (HMS) leaders met the PM last week with a plea to intervene in the BIFR decision to wind up the company. In September, the Board had issued a show cause notice to HA for winding up as it could not find any suitable private bids for the proposed change of management in the company.

However, the Board has now further extended the time for private bidders eying on the public sector pharmaceutical company for one more month till January 2004. The Board, in the hearing held on 18 December, also kept the winding up plan in abeyance as the operating agency, IDBI, has been told to come up with an appropriate proposal after scrutinizing the bid documents received form private parties within 60 days.

According to Arun Bhorade, leader, general secretary, HMS, the government move to privatize or to close down the company does not seem to be a fair decision as the company itself has prepared a proposal for the revival of the company without any fresh investment from the government. "It is surprising that the Ministry of Chemicals and Fertilizers is yet to submit the proposal to the BIFR," he complained.

When asked about the government stand on HA, Vinay Kholi, secretary, Department of Chemicals told Pharmabiz that the government can not make any fresh fund infusion in the company and it does not have any reservation against new revival proposals whether it is from the company or from private parties. "Since the matter is with the BIFR at present, let the Board take a fair decision on this," he added.

It may be recalled that even after the BIFR show cause notice to the company, the BIFR had allowed the Mumbai-based Sun Pharma to submit a proposal to take over the company. However, with the time extension, the IDBI would re-invite the proposals from the interested parties. At present, there are already three private proposals with IDBI received from Sun Pharma, KP Group and the Pune-based Thombre Group.

However, the Board has now put forward another condition for the bidding that all the parties can re-submit their proposals with a security deposit of Rs 5 crore to IDBI.