Bihar hires SBI Caps for sales of 15 sugar mills

The government of Bihar has appointed SBI Capital as a financial consultant for evaluating the assets of the 15 sugar mills owned by the Bihar State Sugar Corporation.

"We expect their report and recommendation on prospective buyers to come by March," said Sushil Modi, deputy chief minister. The state will not run any of these mills, he added.

"The purpose is to revive these closed mills either by selling them or leasing them out to interested buyers so that they become operational in the 2008-09 (October-September) sugar season", said Nitish Mishra, minister of state, cane development.

At present, Bihar has only 9 sugar mills and the state produced 4.22 lakh tonne sugar last season.

These mills together have a financial liability of Rs 700 crore under various heads and the funds raised by selling or leasing them will be used for clearing the liabilities, Mishra added. However, the state has paid cane arrears of Rs 8.84 crore that these mills owed to farmers.

These mills have a crushing capacity ranging from 850 to 1750 tonne crushed daily (tcd) and their combined capacity is 15,000 tcd. Most of these are lying closed since more than a decade.

These mills are located in the districts of Darbhanga, Madhubani, Champaran and Saran. The state government would try to re-deploy 8,500 employees of these sugar mills in the new mills.

Companies like Rajshree Sugar, Bajaj Hindusthan, Dhampur Sugar and Oudh Sugar have expressed interest in buying these closed mills, said Mishra.