• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

G. Gurumurthy

COIMBATORE, March 20

THE Tamil Nadu Industries Development Corporation (TIDCO) has signed a deal with the Udumalpet-based Suguna Poultry group to take 10 per cent equity in the latter's 100 per cent export-oriented joint venture processed poultry project.

TIDCO, which had originally evinced for a 26 per cent equity in the project, in the Rs.12-crore poultry export project has now decided to limit its equity participation to 10 per cent in Supreme Suguna Foods Company Ltd (SSFCL). The project has been jointly promoted by Suguna Poultry group and the Saudi-based Surpreme Foods Company, which evenly share the Rs 4 crore equity in the joint venture.

The agreement was signed on Wednesday between Suguna group and TIDCO in which the TIDCO Chairman and Managing Director, Mr Arun Ramanathan, Mr B Soundararajan, Managing Director of the Suguna Poultry, Mr B Ramjee, Chief Executive Officer of the SSFCL were present.Suguna Group sources told Business Line that TIDCO's payout of its 10 per cent equity of Rs 40 lakh would be made over to the joint venture company any time. TIDCO joining the SSFCL's equity which had caused uncertainty, has now been finally settled and this will make the state Corporation an `associate' entity in the SSFCL project.

The post-TIDCO presence in the project , it is said, will alter the equity holding of the SSFCL in the 50 (Supreme Foods share): 40 (by Suguna Group): 10 (TIDCO) ratio as Suguna group has chosen to off-load its share of equity to facilitate the TIDCO's participation.

Though there has been some delay in TIDCO joining in the equity of the project which is said to be largely due to the TIDCO's internals relating to a decision on the levels of equity holding it could favourably hold. This issue has, however, not affected either the commissioning or the functioning of the SSFCL's venture.

The originally-conceived Rs 10-crore project structure of the SSFCL comprised Rs 4 crore equity, Rs 5 crore debt (term loan) and Rs 1 crore subsidy. But the promoters subsequently had brought in Rs 2 crore by way of unsecured loan to push up the project outlay to Rs 12 crore.

SSFCL, which started its commercial production of processed `frozen' whole chicken in November 2002, has 100 per cent buyback arrangement with Supreme Foods company, which caters to the Gulf market.

With its processed chicken finding good acceptance in the Saudi, Dubai, Bahrain and Oman markets, SSFCL has stepped up its per day production from the originally rated 16 tonnes to 20 tonnes. .

Its monthly shipment of processed chicken from its Udumalpet plant has also been increased from 165 tonnes in November to 260 tonnes in January and 450 tonnes in Feburary. The company plans to ship 600 tonnes in April and it has in hand export order for 700 tonnes as of now, the sources added.

Article E-Mail :: Comment :: Syndication

Stories in this Section
Rubber crashes on war fears

Copyright © 2003, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line