The initial public offering (IPO) of the Reliance Haryana SEZ Ltd, the special purpose vehicle (SPV) created for setting up multi product mega special economic zones (SEZs) in Haryana, has been deferred.
The postponement was approved at the meeting of board of directors of the Haryana State Industrial and Infrastructure Development Corporation (HSIIDC) held last week. The SPV, which proposes to set up SEZs over an area of 25,000 acre in Gurgaon and Jhajjar, had sought extension for bringing out its IPO and preparation of a revised business plan, citing the ongoing economic slowdown.
As per the clause 11 of the joint venture agreement executed between HSIIDC and Reliance Ventures Ltd (RVL) on June 19, 2006, the SPV was required to bring an IPO within three years from the date of signing of the agreement.
“In context of the current economic environment which has come as a complete surprise to all the financial institutions and had a far reaching effect on economies world over thereby affecting exports, we are sure that both HSIIDC and Reliance Ventures would agree that to go in for and IPO/listing of the company on stock exchanges at this juncture was not advisable,” a June 10 letter from the RVL chairman to HSIIDC said.
Despite repeated attempts, Reliance officials did not respond. Top government officials said Reliance representatives had stressed that in view of the slowdown it would be very difficult to go ahead with further investments and a public issue in the absence of a definite future promise and the SPV would have to wait for some more time to assess the market condition.