Bpl Takes Over Bifora Clock Ind
BPL made the highest bid followed by the Kamat group of hotels which bid Rs 2.19 crore for buying the fixed assets of the company.
However, the Bifora group will continue to own Bifora Watch Industries (BWIL), A Bhatia, managing director, BWIL, clarified.
Bifora, which has about three acres of prime land at the Bommasandra industrial area, Bangalore, was initially set up by Gulf Overseas Co of Hong Kong, owned by H R Gajria, for the manufacture of three lakh electronic quartz clocks and movements per annum.
The company also had a built up area of 2100 sq ft along with plant and machinery.
Bifora had taken term loan assistance from the KSIIDC (Karnataka State Industrial Investment and Development Corporation) and KSFC (Karnataka State Finance Corporation) besides SBI and IFCI for working capital requirements.
However, the project, which commenced production by January 1987, continued to incur cash losses due to low capacity utilisation consequent to marketing problems faced by it during the initial years.
A rehabilitation programme was approved by KSIIDC in 1989, envisaging the expansion of the manufacturing capacity for movements. But due to the changed scope of the scheme, this could not be implemented. This led to further deterioration of operations.
Due to the worsening condition, the company lost financial viability with institutions insisting that the promoters bring in substantial interest-free funds to clear the overdues.
Eventually, KSIIDC took over the assets of Bifora in September 1993 for recovery of its dues.
Following Bifora's advertisements for sale of assets in July 1995, BPL, and the Kamath group of hotels evinced interest. Others included the Government Tool Room and Training Centre, Bangalore.
The Rs 2.2 crore BPL offer is likely exceed the claim of both KSIIDC and KSFC by approximately Rs 39 lakh.
Despite settling the dues to state institutions, Bifora still owes a hefty Rs 3.13 crore to the State Bank of India. However, Bhatia clarified that the sum of Rs 5.33 crore owed to IFCI was by Bifora Watch Industries and not by BCIL. Bifora Watch Industries has been operational and manufacturing activities are still on, he added.
He, however, gave no details as to how the group intended to repay the dues.
BPL's deal covers only the fixed assets of Bifora. However, the fixed assets of Jayadeep Cases, a company which is also located on the Bifora premises, is not part of the deal.
BPL has drawn up three ambitious projects in and around Bangalore.