Sindh govt plans to sell Thatta Sugar Mill


KARACHI : The Sindh government is planning to sell the non-operational Thatta Sugar Mill to a private party for Rs 80 million, it is reliably learnt. The industries and commerce department of Sindh government recently held an auction of the mill, which was rendered closed due to financial losses suffered by the industrial unit in 1995.

Only one private party showed interest and offered a bid of Rs 80 million, well-placed sources told Business Recorder on Tuesday. Till 2007, Sindh was having two state-run mills - Thatta Sugar Mill and Dadu Sugar Mill - but the then provincial authorities auctioned Dadu Sugar Mill for Rs 90 million despite the fact that the cost of heavy machinery of the mill alone was estimated at Rs 620 million, the sources said.

The PPP-led Sindh government had announced that it would make Thatta Sugar Mill operational on a public-private partnership basis, but it trying to auction the mill as soon as possible, the sources said. The state-run mill owes more than Rs 1.25 billion to banks, growers and Sindh government, they added.

They said the "reserved price" for the mill was set at Rs 230 million. The authorities invited interested parties to the auction through advertisements in local dailies. Only one party - Kohistan Enterprises - that took part in the auction offered the lowest bid of Rs 80 million for the mill. The successful bidder belonged to an influential member of the ruling party of Sindh.

Moreover, the heavy machinery and modern equipment's and other assets of Thatta Sugar Mill are estimated at around Rs 710 million and the auction of mill for only Rs 80 million would cost a loss of billions of rupees to the national exchequer, they further said.

Interestingly, the same company had offered a bid of Rs 130 million for the mill in last auction held in 2007 and it later withdrew from the auction for reasons best known to authorities concerned alone.

"Yes, the auction of Thatta Sugar Mill did on October 28, 2009 and only Kohistan Enterprises took part in the process," a senior official confirmed to Business Recorder. The official said that his department had forwarded a summary of the auction to the Chief Minister Qaim Ali Shah for further action.

Copyright Business Recorder, 2009

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