Kolkata, Aug 25 (IANS) The world’s largest bulk tea producer, McLeod Russel India Ltd, is reviewing “low-yielding and marginal tea estates” to “revive them first”, a company official said here on Friday.
The company might look at disposing of these assets only if it found them difficult to revive.
“There are a few gardens where yield is low and cost is high. We first look at whether these marginal estates can be revived or not and what kind of investments are required.
“And in case, we find there are difficulties to revive them, we may look at it (disposing of assets). This reviews happen every year,” company’s Chief Financial Officer and Whole Time Director Kamal Kishore Baheti told IANS.
Baheti was asked whether the tea planter was trying to cash out of the marginal estates.
The tea producer on Wednesday entered into an agreement for sale with Voom Food Industries Private Limited of Siliguri, West Bengal, to dispose of its Bhatpara Tea Estate, a loss making unit in Dooars.
The deal was subject to necessary approvals. The estate would be sold at Rs 13.2 crore.
“It was a marginal estate and we wanted to sell it. It is a standalone case. It is not that we are trying to get out of the marginal tea estates,” Baheti said.
The estate with a 15.53 crore of revenue had contributed only 1.11 per cent of total turnover of the company.
“It incurred a loss of Rs 3-4 crore in the last fiscal,” Baheti said.
According to a statement, the Voom Food Industries intends to make appropriate investment in the Bhatpara Tea Estate to make it viable in future.