Mafatlal to sell Byculla land

Mafatlal Industries has put its closed textiles mill in central Mumbai up for sale to cash in on the

booming realty market in the city. The proposed sale of seven acres, or roughly 28,000 sq. mts. of mill land might earn the ailing company at least Rs 1,000 crores. Mafatlal will be giving an equal amount of land to the adjoining Byculla zoo. The Byculla land is part of the assets identified as surplus under the BIFR (Board for Industrial and Financial Reconstruction) sanctioned scheme. The company may not use the sale proceeds to implement the BIFR-approved rehabilitation scheme as it would soon come out of the BIFR net.

The century-old textile company’s net worth turned positive in the 14-month period ending May 2010. So it will soon approach the BIFR to de-register it. In 2000, Mafatlal Industries was referred to the BIFR, which sanctioned a rehabilitation scheme in 2002 that was later modified in 2009. Mafatlal Mills was closed in the 1980s when most of the mills were shut down as owners found them unviable and declared they were incapable of paying their workers’ dues. The company now produces 85,000 mts. of textiles a day at its units at Navsari near Surat and Nadiad near Ahmedabad.

Meanwhile, state-owned National Textiles Corporation has fixed the reserve price of Bharat Mills and Poddar Mills at Rs 750 crores and Rs 250 crores, respectively. Land of these two closed textile companies will be auctioned electronically in the first week of August. The successful bidder is expected to pay the bid amount in 90 days. NTC plans to raise around Rs 4,000 crores by selling 90 acres from a total of nine mills in Mumbai.