The Hindu : Business : Talks on for Travancore Rayons takeover by new promoter

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Saturday, Oct 28, 2006
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Talks on for Travancore Rayons takeover by new promoter

Staff Reporter

Focus will be again on the firm's one-time settlement of dues

KOCHI: After the much-awaited takeover of Travancore Rayons Limited by the Coimbatore-based NDEE Group failed to materialise, another private group has entered the scene.

The Elanjikkal Group has reportedly expressed interest in taking over the Perumbavoor-based company. Negotiations are under way between the State Government and the representatives of the group, according to sources.

The focus will be again on the one-time settlement of dues of the company with public sector banks. The issue could not be resolved earlier during the talks held by the Government and the banks to facilitate the takeover by the NDEE Group. Over 1,000 workers were eagerly awaiting the reopening of the company for the last few years. There were high expectations among the stakeholders when the NDEE Group came forward with a revival package.

The NDEE Group was ready to invest about Rs.550 crore if the dues were cleared prior to the takeover. The talks with a consortium of lending banks and financial institutions were deadlocked over the settlement of dues amounting to more than Rs.50 crore. The IDBI, one of the lending banks, had agreed to reach a settlement and it was expected that other banks would follow suit, though the expectation failed to bear fruit. Though the company had an accrued loss of about Rs.130 crore, the Government had agreed to waive tax dues. The trade unions too had announced the formation of a coordination committee to facilitate an agreement. The State Government, in its talks with the earlier promoter, had promised interest-free deferment of electricity charges for three years from the date of commencement of operations. The Government had also agreed to extend the lease of the existing factory land. But the proposal failed to take off owing to the inability to thrash out the one-time settlement.

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