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Mr Kartikeya Sarabhai

Virendra Pandit

Ahmedabad, Dec. 29 His visionary father inherited vast family businesses and fortune, but, choosing the paradise of mind instead, he created numerous institutions out of nothing. Dr Vikram Ambalal Sarabhai’s son, Kartikeya, is now reviving the nearly-defunct Sarabhai Chemicals Ltd and more in 2009.

By March 2009, the revived flagship Ambalal Sarabhai Enterprises Ltd (ASEL) would be ready with its blue-print for a phoenix-like rise of the Sarabhai Group, its Chairman, Mr Kartikeya Sarabhai, an environmentalist, told Business Line here.

Not surprisingly, he has named the marketing network as ‘Phoenix,’ wherein he is appointing 150 men in the next three months and as many by end-2009, to cover about 15 States.

He said the company has embarked upon a Rs 250-crore restructuring plan, incorporating a four-pronged revival programme through subsidiaries in the areas of bulk drugs (APIs), formulations, pharmaceutical exports and electronics. He was in talks with banks and other financial institutions in this regard.

For this restructuring, he had to sell the company’s real estate in Vadodara, unlocking the value of the companies and the market goodwill enjoyed by the Sarabhais, capitalising on intellectual properties through joint ventures by selling the company’s 50 per cent stake in Sarabhai-Piramal and Sarabhai-Zydus, set up in 1997 and 2001, respectively. This stake was sold in 2003 and 2007, respectively.

Mr Sarabhai said he has cleared all debts the company owed to banks and private lenders, settled litigations, and offered golden handshakes to about 1,500 employees through voluntary retirement scheme.

“By the end of the financial year 2008-09, we would be completely out of the red.” The company sold 60 per cent of its prime real estate in Vadodara in four parcels to raise about Rs 220 crore, cleared nearly Rs 200 crore debts , owed mainly to ONGC (Rs 42 crore), Gujarat Electricity Board (Rs 7 crore), banks (Rs 20 crore) and statutory dues including backlogs in gratuity and VRS (Rs 85 crore).

The company is seeking Rs 50 crore as fresh loan from the banks to come back on the rails. For the remaining realty in Vadodara, Mr Sarabhai said he is working on developing an industrial park in association with the State Government. The way the Group is finally coming back to shape is the culmination of a 13-year-long effort .

For close to 40 years , Sarabhai Chemicals Ltd was the market leader until 1988, commanding more than 10 per cent of India’s pharmaceutical market.

More Stories on : Sick Units | Pharmaceuticals

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