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Future looks bleak for Sirpur Paper Mills
The revival hope of Sirpur Paper Mills (SPM) is all but over, it seems, as the banker put it up for sale to recover its dues. Around this time last year, the news of ITC paper division’s interest in acquiring the SPM raised hopes of the 3,000-odd employees of the mill. But it remained like an illusion.
A consortium of banks puts the mill for sale to recover dues
Sirpur Kagaznagar: The revival hope of Sirpur Paper Mills (SPM) is all but over, it seems, as the banker put it up for sale to recover its dues. Around this time last year, the news of ITC paper division’s interest in acquiring the SPM raised hopes of the 3,000-odd employees of the mill. But it remained like an illusion.
The mill, started in 1938 by the then Nizam rulers, is one of the oldest paper mills in the country. Later, it was acquired by the Poddar Group of Companies and has seen heights of success until 2010.
Due to high raw material costs coupled with poor demand, the SPM management, which struggled to pay salaries and repay debt, shutdown the mill on September 28, 2014, thus hitting the livelihood of at least 10,000 families, directly and indirectly dependent on the mill. Although the State government held a series of meetings with the representatives of ITC, Papcel and the JK Paper Mills in last two years, the fate of the SPM remained same.
Against this backdrop, the IDBI-led consortium of banks has issued an e-auction sale notice on October 28, 2016. The bids that opened on January 23 will close on February 14. The reserve price was kept at Rs 385.77 crore.
In all, the SPM management owes Rs 422.21 crore to IDBI, Central Bank of India, State Bank of Hyderabad, Andhra Bank, State Bank of Patiala, State Bank of Mysore, Syndicate Bank and State Bank of Bikaner & Jaipur.
The IDBI has made arrangements for the bidders to inspect the SPM property providing them an opportunity to evaluate the assets from January 8 to February 5. The e-auction will take place on February 16.
Meanwhile, the workers living in the mill’s quarters to face power cut with Discom reportedly decided to snap the power line for non-payment of dues that amount to Rs 35 crore. It may likely to affect the water supply to quarters also.
“Since the closure of the mill, no less a dozen workers ended their lives unable to run their families,” Shabbir Hussain, the INTUC former general secretary, said. Speaking to The Hans India, Sirpur MLA Koneru Konappa said: “The government was keeping its fingers crossed over the outcome of the e-auction sale.
We are pursuing with the banker to give preference to the buyer who will keep the factory alive. The government is ready to provide assistance under the new industrial policy TS-iPASS to the buyer in running the mill.” Of late, the paper industry is in dire straits, he admitted, pointing out the closure of several mills in last few years.
