Mysugar proposes bittersweet plan to clear debts

ARCHITECTURE / Mysugar proposes bittersweet plan to clear debts
Landmark building may be sold
Deccan Herald

Will the State government sell off one of its oldest buildings in Bangalore City to salvage a debt-ridden company in Mandya? Most likely, says Transport Minister N Cheluvarayaswamy, who is also in charge of the district. Mandya-based Mysugar Company Ltd, which is buckling under a liability of Rs 285 crore, is hoping to auction off its building on J C Road to tide over the crisis.

“The decision on the building auction has been kept pending, as the property is still attached to the I-T department for the recovery of dues. A recent meeting of the stakeholders, headed by Chief Minister H D Kumaraswamy, decided to revive the only sugar factory in the State owned by the government,” Mr Cheluvarayaswamy said.

This landmark building on JC Road (Opp Town Hall) was built in 1933 and now houses offices and banks. According to a rough estimate, the building, which measures 60,000 sq ft, is worth Rs 70 crore. At present, the building is generating a monthly income of Rs 10 lakh. “A detailed assessment of the property is under progress,” he said.


A new co-generation plant with a production capacity of 30 MW of power is one source of revenue. “The government has decided

to fund up to Rs 36 crore this year and has already sanctioned Rs 10 crore,” Mr Cheluvarayaswamy said.

“The co-generation plant will generate 30 MW of power, while the internal consumption will be only 8 MW,” Mysugar Managing Director P K Garg said.“The excess power will be sold to KPTCL; this could work out to a turnover of Rs 2 to 3 crore every month.”

The crisis in the sugar company surfaced after three consecutive years of drought. If poor sugarcane yield and slumping sugar prices were detrimental to the company, mounting I-T bills and other dues were also setbacks.

“The sugar production target is 5,000 tonnes per day, but the production is only 2,800 tonnes. With co-generation, it may go up to 3,500 tonnes. It is likely to reach 5,000 tonnes in about a month,” Mr Garg said.

According to sources, the only hitch in selling the Bangalore property would be in the marketing.

“We will continue to have MD’s offices at both Mandya and Bangalore. But a complete relocation to Mandya might take a toll on marketing and coordination between the government departments,” a source said.