5 companies submit fresh bids for 31 ailing UP Sugar Mills

Lucknow, Jul 18 (UNI) Altogether five companies have submitted their bids for 31 mills of the Uttar Pradesh Sugar Corporation after the state government rejected the earlier bids after setting up new terms and conditions for the bidding process to privatise these ailing mills.

The state government had set up new terms and conditions for the bids and invited fresh Expressions of Interest (EoIs) by July 17, in which five companies -- U Flex Noida, Era Landmark Industries Ltd, Chadda Sugar, Gamon India and Dalmia Sugar -- have submitted their bids.

Official sources here today said now the bids would be evaluated by a highpowered committee and the consultant agency before finalising the deal.

On June 30, five companies -- Bajaj Hindusthan, Dalmia, Magna, Chhadha Group and the Diamond Group -- had submitted their bids which were later rejected. The officials said the bids were cancelled since Recovery Certificates (RCs) had been issued against some of the bidding companies, besides other anomalies were also detected.

The new terms set up by the government after rejecting the first bidding were that the company should have a net worth of at least Rs 600 crore, minimum turnover of Rs 500 crore and must have posted cash profit for at least three financial years in the last five financial years. Besides, interested firms will have to bid for the entire equity of the corporation sugar mills.

All these sugar mills were located at prime locations in the state and have a sizeable land asset. Of the 31 sugar corporation mills, 22 were in a working condition, but only 17 of them had participated in the 2007-08 crushing season. This was the fifth bid by the state government in less than three years for privatisation of these sugar mills.

The accumulated loss of the mills of the corporation was around Rs 2,000 crore. The Mayawati government had provided a budgetary grant of Rs 200 crore to the sugar corporation, but it was not enough.

The previous Mulayam Singh government had decided to privatise 24 sugar mills of the UP Sugar Corporation. The move was mired in controversy as all the mills were proposed to be handed over to a particular company, which has now emerged as the largest sugar producer of the country.

UNI MB JAS PY CS1925