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Rubber factory ready to bail out antibiotics public sector unit

Hindustan Antibiotics Ltd, Pimpri, an ailing public sector unit, has a chance of staying afloat yet.

Written by Manojmore | Pune |
September 22, 2008 3:02:16 am

Proposes to reconstruction board: Will buy 20 acres of vacant land for Rs 120 cr and set up industrial complex

Hindustan Antibiotics Ltd, Pimpri, an ailing public sector unit, has a chance of staying afloat yet. Though it failed to raise money through the sale of a prime piece of vacant land, a prospective buyer has finally shown interest. A Bhosari-based industrial firm, Bhor Rubber Factory, is ready to pay Rs 120 crore for the 20-acre plot between Ajmera and Nehrunagar.

Sopan Bhor, managing director of the Bhor Rubber Factory, said they have already sent a proposal to the Board for Industrial and Financial Reconstruction (BIFR), which is looking after Hindustan Antibiotics. “An acre of commercial land in the MIDC area costs Rs 6 crore. That means that plot should be on sale for Rs 120 crore. If BIFR gives its okay, we will pay the amount in barely one month,” said Bhor.

The antibiotics firm, however, is looking at a higher price. “We are looking at around Rs 150 crore,” company secretary A S Vaidya said. “But Bhor Rubber Factory is welcome to negotiate. If they really have such a proposal, they should come forward and discuss it. Only after discussions can things be worked out.”

Bhor Rubber Factory prefers to negotiate directly with BIFR. It plans an industrial and commercial complex on the 20-acre plot. “The project would be a joint venture and this is an ideal location. The industrial and commercial complex will suit both the industry and domestic consumers,” said Bhor, who is also the president of the Lagu Udyog Bharati.

Bhor said four-five financiers have evinced interest in buying the land and setting up an industrial and commercial complex. Since the company has now recalled the tenders, he suggested it should not go for another retendering. “The BIFR should hold direct negotiations with us. Also, it is imperative that the company should get clearance from the state government and the Pimpri-Chinchwad Municipal Corporation,” he said.

But Vaidya said since Hindustan Antibiotics was a Central Government unit, re-tendering was inevitable.

On September 18, when tenders were opened, only two bids were found for the land. One party quoted Rs 34 crore and the other Rs 75 crore — both amounts much below the company’s expectations.

Vaidya said the amount they are seeking to raise through the sale is part of the rehabilitation package announced by BIFR.

The company was declared sick in 1997 and was referred to BIFR. Last year, it had a turnover of Rs 120 crore. “This year we expect Rs 150 crore. All units of the company are working,” Vaidya said.

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