VRS hits Century textiles operations

95% employees opt for voluntary retirement.

Century Textiles today announced that its manufacturing operation at the Worli unit in Mumbai have become almost stagnant.

The B K Birla group company informed the stock exchanges that the stagnation was due to 95 per cent of workers opting for the voluntary retirement scheme. As much as 6,300 workers out of a total of 6,600 have taken the VRS, which offered in the range of Rs 8-10 lakh compensation to workers. The VRS closed on Tuesday.

"Almost all the looms and spindles are practically not working and with 300 workers left now, it is not possible to run the whole unit," said R K Dalmia, president, Century Textiles and Industries. He added that the mill was headed towards closure.

According to the company sources, the mill, at present, has raw material to continue for another 4 months suggesting that mill will continue for a short time.

There are speculations that company will either sell or develop its land which is spread over an area of 30 acres. Out of this, Century textiles had taken 10 acres from the Wadias of Bombay Dyeing on a lease for 999 years.

Century cannot do anything with the lease land except textiles business without the consent of Wadias. So Birla may keep this land out of its sale or redevelopment plan.

On the question of selling and redevelopment of the mill land, Dalmia said that so far the company had not thought over it.

He added the whole issue will be legally examined before taking a final call.

Sources added that, nearly 1,200 looms and 77,000 spindles are in the Mumbai facility of the company.

Earlier, they had indicated that production of fabrics will be brought down by reducing the number of looms in operation to about 500.