The board of directors had decided to disinvest partially or fully the public sector unit's stake in the tractor and food-processing equipment divisions.

The bidding process for the tractor division, initiated by the ministry of industry in August, met with a good response. Several key players including Bharat Earth Movers, Mahindra & Mahindra, Hindustan Motors, Tractors & Farm Equipment, and Telco were in the race. The ministry has also promised an early initiation of bidding for the division. However, despite companies evaluating the division premises, no other step has been taken by the government to initiate new bids, sources say. The ministry had decided to call for fresh bids withinweeks.

HMT was in talks with the National Dairy Development Board for a possible takeover or joint venture for its food-processing equipment unit in Aurangabad. The board has conducted a technical and feasibility study to assess and evaluate the food-processing equipment division.

However, a possible change in the board's top guard, coupled with the finance ministry's lack of interest, has forced the HMT to put the plan on the backburner, as well. The division recorded a net loss of Rs 1 crore on sales of Rs 4 crore during 1997-98. With a total work force of 120, the division manufactures separators and pasteurisers used in food processing.

The plan to hive off its lamps division into a separate company has been dropped as the division has failed to locate a joint-venture partner. A voluntary retirement scheme is being offered to the employees of the division, which has already reduced the work force from 1,300 to 1,200. Once the work force is reduced drastically, plans are under way to sell off theassets of the division.

HMT had also asked for assistance in the form of loan or additional equity infusion by the centre to the tune of over Rs 100 crore. The company enhanced its equity base by Rs 10 crore a few months ago to Rs 110 crore. However, sources claim that there has been no move by the ministry of finance apart from informal discussions on the issue.

Infusion of additional capital is necessary for the company, say analysts. The results for 1997-98 show sales of Rs 920 crore as against Rs 920.20 crore during the previous financial year. Losses have fallen to Rs 28.50 crore from Rs 43.78 crore during 1996-97.