MUMBAI, May 14: The Maharashtra government has asked the board of Meltron to submit a restructuring proposal before going ahead with its privatisation. The decision could be a fallout of Natalco withdrawing its bid, observers say.

Meltron chairman Deepak Sawant told on Wednesday that he would convene a board meeting during the last week of this month to prepare a concrete restructuring plan for the company whose accumulated losses were over Rs 10 crore.

"The emphasis will be on a complete recast for a better balance sheet," he said, adding that efforts were needed to increase Meltron's rating in the market before going for privatisation.

Sawant said the board would also appeal to the government to provide Rs 21 crore on a priority basis to procure raw material. This was necessary to meet the Rs 24 crore production order from the Department of Telecommunications. "Owing to the shortage of funds the order has been pending with Meltron for two-and-half months," he added.

After the Natalco fiasco, the industry department had considered three options — closure of the loss making Meltron, implementation of voluntary retirement scheme and floating fresh tenders for privatisation. These options, Mantralaya sources say, have been submitted to the state chief secretary.

Sawant said that the government's VRS will be welcomed as there was surplus staff in Meltron. He brushed aside reports regarding mass resignations by engineers saying only 22 had left last year.

It may be recalled that Natalco backtracked in the first week of April after the government decided to exclude Meltron's property in Nariman Point from the original bid. This property, which is over 2,000 sq ft, could fetch over Rs 16 crore.The government's decision followed the directive from Shiv Sena chief Bal Thackeray as the property's owner, Jadhav-Deshmukh Trust, had decided not to increase the lease period. Sources said that the government had paid earnest money deposit of Rs 25 lakh to Natalco which had deposited it at the time of filing the bid document and quoted Rs 225 per share.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.