The Hindu Business Line : Trayons reopening to take 3-4 months

Kochi, Aug. 15 Though the State Government has issued an order accepting the revival package offered by the new promoter for reopening Travancore Rayons Ltd, it may take three to four months before the factory at Perumbavur near here starts functioning.

The Government had announced that a formal agreement with the promoter, Kochi-based Elenjical Group, would be signed before the beginning of the Onam festivals on Aug 26.

The Kerala High Court, on the intervention of the State Government, had stayed liquidation orders of AAFIR and BFIR in 2002.

The court now has to clear the package and for that the State Government has to convince the court that the proposal is viable, Mr Joseph Varughese, Managing Director of the Elenjical group, told Business Line.

He said that 95 per cent of the creditors had accepted the revival package. Sixty per cent of the creditors are government departments/ agencies while 30 per cent are financial institutions and banks.

Govt waiver

In fact, the government has agreed to waive the outstanding amount due to it while the financial institutions have agreed in principle to arrive at a one-time settlement. Five per cent of the liabilities are of the workers, which the promoters have already agreed to settle.

The remaining five per cent is related to the suppliers, which will be sorted out in due course, Mr Varughese said.

At a meeting convened by the government with the creditors earlier, the latter had accepted the proposals and agreed to settle all the issues, he said. It will now depend on as to how the government is going to present it before the court, he added.

The promoters, he said, are ready to go ahead with the revival of the company as per the earlier agreement that the government had entered into with the Coimbatore-based group minus the demand for sales tax concessions and the allotment of 300 acres of forestland. These two clauses could be deleted from the agreement “as we don’t need them,” Mr Varughese said.

The promoters has already paid Rs 50 lakh to the Kerala State Industrial Development Corporation as token money to show commitment to reopen the company.

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