SM Dyechem''s glycol unit seized by IDBI

19 October 2004

Mumbai: IDBI Ltd has attached the assets of SM Dyechem's glycol plant near Pune — which has accumulated losses of Rs378.02 crore for the fiscal 2004 — for defaulting on loan repayments under the Securitisation Act.

In a notice to the Bombay Stock Exchange, the company, promoted by S M Shetty, said ''IDBI has taken possession of assets of the glycol divison in Pune last Saturday under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002''.

Dalal Consultants and Engineers, consultants and architects, carried out an inspection at the instance of IDBI and in May 2001 valued the plant at Rs112 crore with a distress sale value of Rs91 crore. The net book value of these assets, as per the company, was as high Rs 413 crore.

SM Dyechem's glycol unit had an interest liability of Rs349 crore for the fiscal 2004 and another Rs1,725 crore was the accumulated interest liability as on March 2004.

S M Dyechem, makers of snack foods, was planning to sell off its non functional Glycol plant to raise funds for its revival. The glycol unit of the plant was closed for the last eight years.

Though the company had sought some waivers from BIFR seeking interest concessions, the latter had rejected it.