Nagarjuna Fertilisers and Chemicals (NFCL) is likely to be divided into two entities focusing on oil interests and fertiliser assets. For this, two companies have been floated - Kakinada Fertilisers (KFL) and Nagarjuna Oil Refinery (NORL).

NFCL has about 71 per cent holding in Nagarjuna Oil Corporation, which has been working on a plan to set up an oil refinery at Cuddalore in Tamil Nadu. Apart from NFCL, the Tata Group, too, has a holding in the refinery project.

Now, NFCL's share in the refinery project will be moved into NORL. Similarly, the fertiliser assets, which are primarily located at Kakinada in Andhra Pradesh, will be moved into KFL. Additionally, iKisan, another group company, too will be merged into KFL.

Though NFCL ceases to exist for now, KFL will be renamed as NFCL once the scheme of amalgamation and demerger is approved by the High Court of Andhra Pradesh. With the appointed date for the said scheme is 1 April 2011, the scheme will result in creation of two companies.

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