Leading paper companies are interested in acquiring Telengana-based Sirpur Paper Mills, which is currently undergoing insolvency proceedings at the Hyderabad bench of the National Company Law Tribunal (NCLT). SPM is currently owned by Ranjan Kumar Poddar and Devashish Poddar who took over management from the CK Birla group in 1994, which purchased the company in 1950. Said to be in the fray are paper manufacturers who in the main are enjoying some buoyancy in the domestic paper market. According to the financial press, these include the ITC Group’s paper division, JK Paper, West Coast Paper Mills and the Kohinoor Group.
The deadline for receiving expressions of interest ended in December, and the deadline for binding bids is later this month. So far none of the companies said to be interested have answered queries by the financial press as to their interest.
The last available revenue figures for Sirpur that are available on the Moneycontrol website are for the financial year ending 31 March 2014, which show a revenue of Rs. 430.59 crore with a loss of Rs. 90.98 crore. The company which increased its annual capacity to 138,300 tons is said to have 3,000 employees. The mill shut operations in 2014 after reporting a loss in successive quarters, for which the management blamed rising raw material costs. Apparently, the Telangana government has assured that all necessary efforts would be undertaken to revive the ailing company.