Varun Shipping, vice-chairman, Arun Mehta said that Insa (Indian National Shipowners Association) has made a represenation to the ministry of finance and shipping on the subject and is hopeful that it will be sympathetically considered.

Mr Mehta is hopeful that the finance ministry will either roll back the customs duty or neutralise the same by issuing some sops. There is no question of reviewing the fleet acquisition plan, he said emphatically.Varun Shipping's rights issue comprises 14 per cent unsecured fully convertible debentures of Rs 10 each at par aggregating Rs 36.26 crore.The FCD will be converted into one equity share after a year.

Prior to the conversion of the equity, the FCD will earn an interest of 14 per cent payable semi-annually, which has been guaranteed by ICICI Ltd and has been rated A1+(SO) by ICRA.

The company has received written confirmation from the promoters and financial institutions - IFC and ICICI - to subscribe to 47 per cent of the issue while the rest has been underwritten, Mr Mehta said.

The company had consciously kept itself out of the market, waiting for an opportune time, though the rights issue was cleared by Sebi more than nine months back. However, the dark clouds gathered over the stock market over the payment crisis might play spoilsport.

Commenting on the timing of the issue in a falling interest regime, Mr Mehta said it was a bold initiative to expand the equity and maintain a reasonable debt equity ratio. It was also keeping in mind the capital intensive nature of the shipping industry as also releasing benefits to the shareholders by way of dividend, he added.

Varun Shipping has an impeccable track record of uninterrupted dividend for the last 17 years with minimum dividend during the time being not below 14 per cent.