The Hindu Business Line : Mills revamp: NTC revises offer under jt venture partnership scheme

Reworked plan
The revised offer would allow private parties to command the mill management for a 33-year lease-in period.
It would also allow bidders to use the entire mill land, including the surplus lands in the premises, for textile related activities.

G. Gurumurthy

Coimbatore, Sept. 30 The National Textile Corporation (NTC) has come out with a revised offer for companies that have sent in expression of interests (EoI) for participating in the joint venture partnership for revival of 16 sick textile mills under its fold.

The corporation has also offered time till October 4 for the 14 private sector entities, which had earlier filed expression of interest (EoI), to come out with their response for NTC’s revised joint venture offer.

NTC has sought to relax its original offer in the wake of the prospective bidders harbouring doubts on the viability of the initial offer, especially on the outer lease-in period of 15 years specified for the joint venture partner running the sick undertaking. The revised offer would now allow the private parties to command the mill management for a 33-year lease-in period. In addition to more lease years, the revised offer would also allow the bidders to use the entire mill land, including the surplus lands in the premises, for textile-related activities. The revised offer has been cleared by the Group of Ministers, according to a top official of NTC.

NTC had, in March last, floated the joint venture offer for 16 of the 18 sick textile mills slated for revival under the public-private partnership route in which NTC would control a majority stake of 51 per cent (by way of leasing its mill infrastructure) and the joint venture partner would take 49 per cent stake (that covers finance, manpower, investment on machinery etc). Fourteen private consortium partners sent in their EoI for the 16 textile undertakings, that include 10 mills in Maharashtraalone.

Mr K. Ramachandran Pillai, Chairman and Managing Director of NTC, told reporters from The Hindu group that the process of identifying the joint venture partners would be finalised towards the end of next month. Though the joint venture for the 16 units would be through individual special purpose companies, more than one mill administration could be run by the same joint venture partners.

As for the two remaining sick units — Coimbatore Spinning and Weaving Mills and Sarada Textile Mills — the NTC management has chosen to leave them out of the purview of the joint venture scheme of revival for the time being.

According to Mr Pillai, the fate of these two units, whose revenue generation is still considered far short of meeting their workmen’s wages, is still a question mark. This means the government may or may not finally refer the two units for the joint venture revival scheme.

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