Coromandel Sugars (CSL), the sugar manufacturing arm backed by India Cements (ICL), is preparing to sell its assets to Sri Chamundeswari Sugars (SCSL), a company under the Coimbatore-based Sakthi Group, reported The Hindu Businessline.
Both CSL and SCSL operate sugar plants in Karnataka’s Mandya district. The Hindu Businessline citing sources reported that discussions have taken place between the two sides to finalize the deal. Both parties have chosen to structure the deal in the form of transfer of assets of CSL (including the sugar plant and others) to SCSL, rather than takeover of CSL as an entity. “SCSL may initially run the CSL plant on lease basis for a few months and then undertake transfer of assets”, sources said.
Currently, 49.99 per cent of CSL’s shareholding is held by Coromandel Electric Company and the remaining is held by ICL’s group company Sri Saradha Logistics. Interestingly, Coromandel Electric, was until recently, a subsidiary of ICL, but in March, ICL sold their entire stake in CECL to Chennai-based Adam & Coal Resources Private Ltd.
Founded in 1996 as ICL Sugars Limited and renamed Coromandel Sugars in 2007, CSL manufactures sugar and molasses and operates a cogeneration power facility. Its plant in Makkavalli, Mandya district, has an installed sugar crushing capacity of 3,500 tonnes per day (TCD) and a 30 MW multi-fuel cogeneration power unit.
SCSL, part of the Sakthi Group founded by the late Dr. N. Mahalingam, has a sugar crushing capacity of 4,000 TCD and operates a sugar complex that includes a distillery, ethanol production unit, and a cogeneration plant powered by molasses.
As per the media report, CSL declined to comment on the matter, and queries sent to SCSL by Businessline remained unanswered at the time of publication.
