Calcutta, July 14: Duncans Industries Ltd chairman GP Goenka, is scouting for a joint venture partner to revive the ailing Andhra Cements Ltd. The Duncans management is studying various options to get the company out of the ambit of the Board for Industrial & Financial Reconstruction (BIFR).

Apart from the option of a joint venture, the management is also toying with the idea of selling the cement maker, highly-placed company sources said. The management is understood to have held preliminary talks with a French cement major.

The huge accumulated loss of Rs 243.97 crore as on March 31, 1997, has been the main stumbling block in the revival of the company, which was promoted by Bennett, Coleman & Co Ltd. The interest burden of the company on March 31 was Rs 119.62 crore.

Duncans Industries Ltd has sought additional concessions, amendments and certain clarifications on the BIFR scheme, sanctioned in June 1994.

The Duncans group subscribed to 95 lakh equity shares of Rs 10 each during 1996-97, in accordance with the directions of the Board for Industrial and Financial Reconstruction.

The share capital of the company, which was Rs 16.70 crore on March 31, 1996, increased to Rs 26.20 crore on March 31 this year. Duncans Industries invested in 1.37 lakh equity shares of Rs 10 each in Andhra Cements during the year.

Of the three units -- at Secunderabad, Vizhakapatnam and Vijayawada -- the first two have resumed operations. In fact, during March, the two units were able to generate small cash profits.

Goenka told the The Financial Express that the management is toying with the idea of entering into a joint venture with partners who are ready to bring in proven technology and equity.

Goenka ruled out the possibility of an outright sale, but confirmed that during his recent Europe tour, the joint-venture proposal for Andhra Cements `definitely' figured on his agenda.

According to Goenka, the past management of Andhra Cements had `not bothered' much about the company. The notes on accounts annexed to the balance sheet point out that "some of the records of the company like agreements with suppliers/ agents, statements of bank accounts including those at branches/ depots have still not been restored by the erstwhile promoters/ management and the same could not be verified".

The company has already achieved the Board for Industrial and Financial Reconstruction target of producing 1.5 million tonnes per annum.

In May, production hit 2.15 lakh tonnes. While the main plant at Secunderabad is operating at full capacity, the Visakhapatnam plant is operating at 50 per cent capacity.

The Vijayawada plant has been closed for the past four years and at present does not have any work force. The option of selling the assets of the Vijayawada plant is still open with the management.

The contingent liability of the company is staggering. The central sales tax from 1982-83 till 1993-94 on stock transfer amounted to Rs 17.56 crore.

The company has paid Rs 10 lakh "under protest" in line with a court order, and has appealed against it.

The disputed sales tax on gunny, for which the company is yet to provide, stands at Rs 54.84 lakh. Moreover, no provision has been made towards retirement gratuity of Rs 51.44 lakh to the existing work force of 1500 as on March 31.

The company is yet to make provisions on account of the probable liability arising as a result of its non-compliance with the Jute Packaging Materials (Compulsory Use in Packaging Commodities) Act of 1987.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.