BIFR directs Maha Antibiobiotics to close down

BIFR directs Maha Antibiobiotics to close down
AGENCIES

New Delhi, August 7: The Board for Industrial and Financial Reconstruction (BIFR) has directed the ailing public sector Maharashtra Antibiotics & Pharmaceuticals Ltd (MAPL) to wind up its operations.

The two-member bench comprising BIFR chairman P P Chauhan and member G Narayanan confirmed its prima facie opinion that the sick MAPL was not likely to be able to make its net worth exceed its accumulated losses within a reasonable time while meeting all its financial obligations.

The bench also noted that the promoters of MAPL, jointly-owned company by Hindustan Antibiotic Ltd and Sicom Ltd, had not evinced any interest by committing their funds for reviving it despite company being with BIFR for over three years. They were misusing the protection available in the act, it added.

The accumulated losses of the company as per provisional balance-sheet for 1999-2000 were reported at Rs 12.90 crore as against the accumulated losses of Rs 1.47 crore as on March 31 , 1996, the bench said. The company's financial position was deteriorated and the promoters had not inducted any fresh funds, it said.

The bench said there was no rehabilitation proposal for reviving sick MAPL with means of finance fully tied up, for it to consider despite several opportunities given to all concerned. "Ailing MAPL was not likely to become viable in future and that it was just, equitable and in public interest that it was wound up," the bench said adding "any further delay would be detrimental to the interest of all concerned."

The final proposal for reviving MAPL which was based on the offer made by the proprietor of Neelam Gemstones was not found workable as the means of finance were not fully tied up, the bench said. The board noted that the Neelam Gemstones's proprietor was not able to prove his resourcefulness to raise funds required for revival of sick MAPL.

Earlier, the bench had said it would confirm the winding up of MAPL, which had submitted a revival scheme to its operating agency IDBI based on induction of funds by Neelam Gemstones, if the resourcefulness of Neelam was not proved.

However, the operating agency submitted before the board that no revival scheme could be prepared since the proprietor was not able to make a firm tie-up for disposal of his stocks gems and rubies to raise funds for reviving the ailing MAPL.

The bench said there was no positive indication that he would be able to accomplish any deal for disposing his gems for raising the resources and therefore, it was felt that no fruitful purpose would be served by allowing any further time to the proprietor of Neelam Gemstones.