The Hindu Business Line : JK Cotton Spinning revival on cards

"We are hoping to generate about Rs 125-150 crore. These funds would be utilised to clear all the debts and make fresh investments in the company too."

Kolkata , Dec. 26

THE Yadhupati Singhania Group is planning to revive the ailing Kanpur-based JK Cotton Spinning & Weaving Mills Ltd, closed since 1989.

According to a senior official of the group, a detailed rehabilitation package has already been prepared and has received the approval from the Board for Industrial and Financial Reconstruction.

As per the package, the promoters had already pumped in Rs 12-15 crore. The management is trying to sell off two major plots of land, which would generate substantial amount of funds.

According to the official, a sale committee has been formed to oversee this deal. In this context, he said, a formal clearance from the State Government of Uttar Pradesh is also expected.

"We are hoping to generate about Rs 125-150 crore. These funds would be utilised to clear all the debts and make fresh investments in the company too," the official said.JK Cotton Spinning & Weaving Mills was the first venture of the undivided JK Group in the cotton sector.

Sources said it started its operations way back in 1920s. Following the division within the group the company came into the Gaur Hari Singhania fold, which is now been overseen by his son, Mr Yadhupati Singhania.

The official said that Mr Singhania, who owns JK Cement Ltd, would focus on two businesses — cement and cotton. "We in the group feel that there is a tremendous potential in the global textile sector and we would like to exploit it. For this purpose we would like to have this company geared up as early as possible," he said.

A one-time-settlement package has been worked out for the financial creditors. It had been approved by the banks and financial institutions of JK Cotton Spinning, the official added.

Talking about the land that the company is trying to sell, he said these are prime properties in Kanpur. "Actually there are two parcels of land. While the first one is one lakh square yard, the second is almost double that," he said.

Meanwhile, in another development, the company is trying to sell off the second and last factory of JK Synthetics Ltd, located at Jhalawar in Rajasthan.

Once the deal is through, JK Synthetics, which is listed in BSE, would become an investment firm.

The Group is also planning a public issue for its flagship company, JK Cement Ltd.

It hopes to raise Rs 250-300 crore for its capacity expansion and new co-generation power plants. Earlier this month, the draft prospectus was filed with SEBI.