Financial Daily from THE HINDU group of publications
Thursday, Feb 14, 2002
Binny makes final payments on VRS; to take up CFS
CHENNAI, Feb. 13
THE Chennai-based Binny Ltd made the final payments on Monday on the Rs 68 crore Voluntary Retirement Scheme, according to company officials. It is now set to commence its other projects under the rehabilitation scheme, including the container freight station and a new textile mill, they said.
Sources told Business Line that the final payment to workers involved disbursement of Rs 20.94 crore to 2,713 workers. Of this Rs 2.71 crore was paid in cash at the rate of Rs 10,000 per worker and the balance in the form of post-dated cheques, they said. This follows the final sanction of the company's BIFR scheme on December 13, 2001, according to sources.
While the BIFR had earlier sanctioned the scheme, it was finally cleared after a clarification meeting in December, they said. This brings the total VRS payment to Rs 67.75 crore, they said.
According to the officials, the company hopes to clear the dues to the banks and financial institutions in March. This includes Rs 108 crore with Rs 62 crore payable to the consortium of banks and Rs 46 crore to financial institutions, Government of India and the State Bank of India. An additional Rs 2 crore is payable by Binny, Karnataka, towards gratuity to retired employees, and provident fund and Employees' State Insurance schemes.
The decks have been cleared for Binny to go ahead with its other projects including a container freight station, which is to come up at the B & C Mills, on which the curtains have come down, they said. The company has renewed the licence to set up the freight station that is expected to commence operations in mid-March. It will have a capacity to handle 5000 TEU per month. The total area will be 25 acres with three lakh square feet of warehouse space and two lakh square feet of paved open yards. The Container Freight Division under Binny Shipping will operate this facility, they said. The company is on the look out for real estate for its new textile mill near S.V. Sugar Mills, a group concern located on the route to Kanchipuram.
This will involve additional investment of Rs 23 crore with nearly Rs 30 crore worth of equipment to be shifted from the existing mill site. The facility will have a capacity to manufacture 80,000 m cloth per day with the yarn to be sourced from Thirumagal Mills, a sister concern, they said.
Meanwhile, the company has sold some of the old machinery to Sri Maruthi Textiles Ltd, Dharapuram, for Rs 9.77 crore. The company is also looking at joint venture development of some of its real estate here, they said.
It may be remembered that Binny Ltd signed an agreement with the workers' union for a VRS scheme in March 1998.
The total outlay for the scheme was Rs. 67.75 crores involving payment of a compensation of Rs. 1.25 lakhs per worker in addition to the statutory payments.
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