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Wednesday, Aug 27, 2003

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Bajaj Hind acquires Monnet Sugar plant

Harish Damodaran
K.R. Srivats

New Delhi , Aug. 26

IN what could herald a process of capacity consolidation in the sugar industry, Bajaj Hindustan Ltd has acquired the 5,000-tcd plant of Monnet Sugar Ltd at Unn (Muzaffarnagar district) in Uttar Pradesh.

The deal, said to be for a consideration of Rs 57 crore, would enhance the Shishir Bajaj-Kushagra Bajaj promoted company's aggregate cane crushing capacity to 22,000 tonnes per day or tcd.

Monnet Sugar is the erstwhile sugar division of Mr Sandeep Jajodia's Monnet Industries Ltd (MIL). The division was transferred to Monnet Sugar with effect from June 16, as part of MIL's plan to exit the sugar business. Mr Jajodia had first entered into an agreement to sell the sugar plant to the Upper Doab Sugar Mills of Sir Shadi Lal Enterprises Ltd (SSE). The latter owns a similar 5,000 tcd unit at Shamli again in Muzaffarnagar.

"Bajaj Hindustan clinched the deal by offering Rs 5 crore more than SSE," sources told Business Line. This marks the second unsuccessful attempt by SSE to acquire a mill. SSE had last year almost purchased the Siddharth Shriram-controlled Siel Ltd's 5,000 tcd Titawi Sugar Complex, but the deal was scuttled by financial institutions.

The 5,000 tcd Unn unit would be Bajaj Hindustan's third sugar mill, besides the 10,000-tcd plant at Golagokarannath and the 7,000-tcd facility at Paliakalan (both in Lakhimpur Kheri district). With this, Bajaj Hindustan's aggregate crushing capacity of 22,000 tcd would be next to only the K.K Birla Group's 38,000 tcd (which includes mills in both Uttar Pradesh and Bihar), the Dhampur Group of Mr V.K. Goel (30,000 tcd), Balrampur Chini of Mr K.N. Saraogi (25,000 tcd) and Mr Dhruv Sawhney's Triveni Engineering (25,200 tcd).

Bajaj Hindustan has, in addition to these, bid for all the 11 working mills of the UP State Sugar Corporation that have recently been put on the privatisation block by the State Government.

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