Tata Tea exit from Asom sends jitters

Guwahati, Nov 01: The tea industry in Asom is in a flutter with Tata Tea announcing its exit from the plantation business in Dooars and Asom.

The tea major would have just 20 per cent stake in a new venture as they announced their exit yesterday from the plantation business leaving the infrastructure to a new company where they will be a minority player. This would allow them to concentrate on the beverage sector.

"It has been on the cards but we thought that Tata Tea would have a larger stake in the future entity," said a top official of a rival tea company.

The small growers were a bit nervous with the latest development as they had developed a good rapport with Tata Tea's 20 estates in Asom by selling green leaves and constantly getting a good price.

Addressing a press conference here yesterday, Vice-President of the North India Plantation of the Tea Major Dipankar Bora announced that the formal transfer would be completed by March 31 next year.

The new company, which is yet to be named, has International Financing Corporation (IFC), International Lease and Financial Service(IL&FS), Globally Managed Services, besides the Tata Tea.

Each of these players would have around 20 per cent stake with the employees having 21 per cent stake.

Mr Bora announced that 31000 employees would have majority stake and Tata Tea would ensure that their future remains intact. But the employees were not sure whether to invest or keep their own divesting option open.

Tata Tea would exit from the plantation business after 23 years after recurring labour, infrastructure and manpower problems, besides, falling prices and high production cost.

EDS:Here pick up suitably from earlier takes.

UNI