The Union Cabinet on Wednesday approved the sale of around 482 acres of surplus land held by central government-run fertiliser firm FACT for about `970 crore to Kerala’s state government. This amount will be used to cut down the company’s debt and enhance its production capacity, a statement said. “Chaired by Prime Minister Narendra Modi, the Cabinet approved the sale of 481.79 acres of land held by Fertilizers and Chemicals Travancore Ltd (FACT) to the Kerala government,” it noted, adding that 150 acres of land will be sold at `1 crore per acre.
In lieu of this, the state government has agreed to give free-hold right over 143.22 acres of land to FACT. The remaining 331.79 acres will be divested at `2.4758 crore per acre, the government said. “FACT is under debt. But, it has potential to increase production capacity and create jobs,” Information and Broadcasting Minister Prakash Javadekar said. The company is being revived to meet fertiliser requirement in southern region of the country, he added.
FACT will utilise these funds to address working capital deficiencies, improve its balance sheet and enhance physical and financial performance by implementing capacity expansion projects for sustainable growth of the company.“This approval will help FACT to reduce the bank borrowings and to implement projects for enhancing fertilizer production capacity and upgrading logistics/raw material handling facilities,” the statement said.
FACT to pare debt
The state-run fertilizer company will utilise the funds raised through the land sale to address working capital deficiencies, improve its balance sheet and enhance its physical and financial performance by implementing capacity expansion projects for sustainable growth of the company, it said