HUDCO moves court for stake in Kochi airport

KOCHI - The government-owned Housing And Urban Development Corporation Ltd (HUDCO) has filed a case in an Ernakulam court, asking it to direct the Cochin International Airport Ltd (CIAL) to transfer 26 percent of its equity shares to HUDCO as part of a prior agreement.

According to the petition, HUDCO had sanctioned loans worth Rs.143.23 crore to CIAL on three ocassions post 1995. In 2002, CIAL had offered to convert a part of the outstanding dues to equity shares, and appointed Pricewaterhouse Coopers as their consultant for debt restructuring.

A CIAL board resolution Feb 1, 2002, said that HUDCO, being its major financier, be requested to invest in equity capital by conversion.

But nothing has transpired since then, HUDCO said in the petition, filed Oct 30, even though the two companies had met in November 2002 over the issue.

Jean T. Mathew, one of the counsel for HUDCO, said that despite several letters to CIAL for the equity transfer, CIAL has failed to act.

“Incidentally, my client has filed a court fee of Rs.7.91 crore, the highest ever paid in a case in the state,” said Mathew.

The petition asked the court to direct CIAL to transfer 26 percent of its equity at par (52 million shares of Rs.10).

Top CIAL officials declined to comment, saying the matter was sub-judice.

CIAL created history in the late ’90s by becoming the first airport in the country to be built with private-public partnership.

Under the present shareholding pattern, the Kerala government holds 35.56 percent of the company, and the directors 37 percent. The nationalised banks and public sector units like Air India hold 10.61 percent, while non-resident Indians and general public have a share of 14.63 percent. Other commercial banks hold 2.2 percent shares.

CIAL, which was limping in its initial years, is now doing extremely well, with profits of Rs.57 crore in 2008-09, compared to Rs.47.12 crore in 2007-08.

–Indo Asian News Service