The Hindu Business Line : Banks told to facilitate one-time settlement for Trayons revival

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Kochi Feb. 20 In a fresh bid to revive Travancore Rayons Ltd (TRL) at Perumbavoor, the State Government has asked the lender banks and financial institutions to go for a one-time settlement of dues.

At a meeting held by the State Industries Minister, Mr Elamaram Kareem, with representatives of the banks and financial institutions, industry department officials and the promoters in Thiruvananthapuram on Tuesday, the Minister asked them to adopt a practical and pragmatic approach to pave the way for the revival of the sick unit.

A final decision is expected in the next meeting, date of which will be fixed soon, official sources told Business Line.

The unit, which is under lay-off for the past four years, has found a new promoter in Kochi-based Elenjical Group of Industries that has come forward with a proposal to rehabilitate the company. Failure to reach an OTS with Indian Bank, Bank of India, State Bank of Travancore and Canara Bank was cited by the previous promoter as a stumbling block.

At a meeting on October 25 last year, presided over by the Industries Minister and attended by the Fisheries Minister, Mr S. Sarma, MLAs and trade union leaders, it was decided to go ahead with the proposal of the new promoter and the Industries Department Special Secretary, Mr P.H. Kurien, was entrusted with overseeing the job.

A decision to avoid the previous promoter, the Coimbatore-based NDEE group, was taken at a meeting held by the Industries Minister on October 17 last year, the sources said. The details of the new revival package are yet to be made public.

OLD AGREEMENT

The previous UDF Government had signed an agreement with the Coimbatore-based NDEE group for reviving the company. As per the agreement, the promoters had to take over all loan liabilities, including those taken by the company under government guarantee.

Similarly, all the dues to the State Government and government agencies had also to be settled. Government concessions and benefits included permission to pay the electricity charges and sales tax in instalments and assistance and cooperation for setting up of new hydroelectric projects, according to official sources.

As per the rehabilitation proposal of the NDEE group, the promoter was to invest Rs 530 crore spread over a period of five years for modernisation of the company.

In the first year, the promoter was to invest Rs 60 crore for renovation of the existing plant. All the old machinery were to be phased out in three years.

The BIFR had ordered the closure of the unit in 2002. The company is under lay-off for over four years now and about 1,200 workers are without wages. At present, the unit is maintained by a skeleton staff of 70 people on a monthly wage of Rs 500.

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