PATNA: In a development that could mark heavy investment in Bihar, and open the doors for more investments in the future, Mukesh Ambani’s Reliance group and public sector oil behemoth Hindustan Petroleum Corporation (HPCL), besides other players are all set to take over the 12 closed state-owned sugar mills on a long-term lease basis. In the competitive bidding invited to take over the sugar mills, Reliance emerged as the highest bidder for the Motipur sugar mills while HPCL managed to ‘outbid’ the other interested players for wresting control of the three other closed mills.
SBI Capital, which was engaged by the state government to oversee the bidding process will now submit its report before the latter hands over the LoI to successful bidders. “After completing the required formalities, the government will sign agreements with each bidder for transfer of the mills assets to the bidders.
All this should be settled within a month or two,” the cane development minister Nitish Mishra told ET. The state government is satisfied that big players like Reliance, HPCL, Upper Ganges and several others are willing to bet on Bihar. “Things are changing for the better in Bihar and the players are no more shy of investing here”said a cane department official.
In fact, Jindal steel and other public sector oil companies were also keen on participating in the competitive bidding, but unfortunately they could not do so,” said a cane department official.
Both Reliance and HPCL were among those who had bid for the Motipur mill. Reliance, however, managed to edge out HPCL by a very slender difference in the bid amount. “The bid offer made by Reliance for the takeover of the Motipur sugar mill was Rs 57 crore against Rs 56 crore of HPCL,” according to a government official, who conceded a difference of Rs 1 crore allowed Reliance to emerge as the highest bidder.
Both Reliance and HPCL, besides Upper Ganges, were also locked in the bid for the takeover of the Hathau sugar mill. HPCL emerged as the highest bidder. Ironically, the bid amount of all the interested parties for the Hathua mill was below the reserved price of Rs 71 crore fixed by the government. Sources said that the state government had the right to settle the deal in favour of HPCL even though the bid amount was below the reserved price. “After all, it was a competitive bidding process, and the reserved price of Rs 71 crore may not reflect the real value,” observed an official who was involved with the bidding process.
Apart from the Hathua sugar mill, HPCL emerged as the highest bidder for the takeover of the Sugauli and Lauriya sugar mills. Given the fact that the centre has made mandatory reforms for ethanol blending, both Reliance and HPCL will essentially utilise the sugar units for ethanol production. The Lohat sugar mill is likely to be bagged by New Delhi-based RollCOM project, which emerged as the highest bidder for this unit.
The state government had appointed SBI Caps as a consultant to conduct a diagnostic study for the revival of the 15 closed state-owned sugar mills and two distilleries. In its report submitted to the government, SBI Caps made a case for the revival of only eight sugar mills while the seven other closed units were deemed as unviable for sugar production. On the basis of the report, the state government decided to invite bids for the takeover of the 15 mills, eight units for revival and seven other for non-sugar industrial use.
Out of the eight closed mills, which were identified by SBI caps as revival units for sugar production, bid offer for their takeover, was however, made for only five units by the Reliance, HPCL and Rollcom projects. That there was no response for the three closed revival units will indeed cause worry for the state government. “We will take a decision in due course of time,” said the cane minister.
Interestingly , SS Infrastructure made the highest bid for producing sugar in the Rayam sugar mill even though the SBI caps had declared that the unit was unviable for sugar production. As for the other six closed units, which were identified as unviable units for sugar production, the Bihar Industrial Area Development Authority (BIADA) emerged as the sole highest bidder. Official sources said the BIADA will develop the land coming under the jurisdiction of the six mills for industrial use.
SBI Capital, which was engaged by the state government to oversee the bidding process will now submit its report before the latter hands over the LoI to successful bidders. “After completing the required formalities, the government will sign agreements with each bidder for transfer of the mills assets to the bidders.
All this should be settled within a month or two,” the cane development minister Nitish Mishra told ET. The state government is satisfied that big players like Reliance, HPCL, Upper Ganges and several others are willing to bet on Bihar. “Things are changing for the better in Bihar and the players are no more shy of investing here”said a cane department official.
In fact, Jindal steel and other public sector oil companies were also keen on participating in the competitive bidding, but unfortunately they could not do so,” said a cane department official.
Both Reliance and HPCL were among those who had bid for the Motipur mill. Reliance, however, managed to edge out HPCL by a very slender difference in the bid amount. “The bid offer made by Reliance for the takeover of the Motipur sugar mill was Rs 57 crore against Rs 56 crore of HPCL,” according to a government official, who conceded a difference of Rs 1 crore allowed Reliance to emerge as the highest bidder.
Both Reliance and HPCL, besides Upper Ganges, were also locked in the bid for the takeover of the Hathau sugar mill. HPCL emerged as the highest bidder. Ironically, the bid amount of all the interested parties for the Hathua mill was below the reserved price of Rs 71 crore fixed by the government. Sources said that the state government had the right to settle the deal in favour of HPCL even though the bid amount was below the reserved price. “After all, it was a competitive bidding process, and the reserved price of Rs 71 crore may not reflect the real value,” observed an official who was involved with the bidding process.
Apart from the Hathua sugar mill, HPCL emerged as the highest bidder for the takeover of the Sugauli and Lauriya sugar mills. Given the fact that the centre has made mandatory reforms for ethanol blending, both Reliance and HPCL will essentially utilise the sugar units for ethanol production. The Lohat sugar mill is likely to be bagged by New Delhi-based RollCOM project, which emerged as the highest bidder for this unit.
The state government had appointed SBI Caps as a consultant to conduct a diagnostic study for the revival of the 15 closed state-owned sugar mills and two distilleries. In its report submitted to the government, SBI Caps made a case for the revival of only eight sugar mills while the seven other closed units were deemed as unviable for sugar production. On the basis of the report, the state government decided to invite bids for the takeover of the 15 mills, eight units for revival and seven other for non-sugar industrial use.
Out of the eight closed mills, which were identified by SBI caps as revival units for sugar production, bid offer for their takeover, was however, made for only five units by the Reliance, HPCL and Rollcom projects. That there was no response for the three closed revival units will indeed cause worry for the state government. “We will take a decision in due course of time,” said the cane minister.
Interestingly , SS Infrastructure made the highest bid for producing sugar in the Rayam sugar mill even though the SBI caps had declared that the unit was unviable for sugar production. As for the other six closed units, which were identified as unviable units for sugar production, the Bihar Industrial Area Development Authority (BIADA) emerged as the sole highest bidder. Official sources said the BIADA will develop the land coming under the jurisdiction of the six mills for industrial use.
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