New Delhi:Debt-ridden Bajaj Hindusthan Sugar has shelved the plan to sell power business to group firm Lalitpur Power Generation Company (LPGCL) for about Rs1,200 crore, even as its lenders have initiated a resolution process under S4A to restructure loans.

The company had announced plans in December to sell its cogeneration power business, having 449 MW capacity at 14 locations in Uttar Pradesh, to LPGCL for about Rs1,800 crore. Later the deal size was reduced to Rs1,227 crore. Bajaj Hindusthan has a debt of around Rs6,000 crore.

In a BSE filing, the company informed that “joint lender forum of the company has taken a decision that the loan account of the company will be taken up for consideration under the ‘scheme for sustainable structuring of stressed assets (S4A scheme) introduced by the RBI (Reserve Bank of India).’

Bankers will evaluate and formulate the resolution plan as envisaged in the scheme for implementation, it added. The company also informed that the proposal for sale of cogeneration power business “has been consequently shelved". The entire amount of cash consideration from the deal was proposed to be utilised by the company towards advance repayment of its existing term debt.

Bajaj Hindusthan has 14 sugar mills with cane crushing capacity of 1.36 lakh tonnes per day and alcohol distillation capacity of 800 kilo litres per day.

Besides sugar, Shishir Bajaj-led Bajaj group has interests in power, ethanol, real estate, personal care products and infrastructure. The group’s power venture includes Bajaj Energy Pvt Ltd, with 450 MW thermal power generation commissioned in 2012 and the Lalitpur Power Generation Co Ltd with a total of 1,980 MW thermal power generation capacity.