McLeod Russel sells three more tea gardens in Assam

Tea major Mcleod Russel sold three more gardens in Assam as the debt ridden company disposed altogether 12 tea estates in Assam.

The gardens are Mahakali, Addabarie and  Diroi  were sold at an approximate price of Rs 150 crores to Luxmi Tea company limited.

The Mahakali garden is also located in upper Assam, in Tinsukia district, where on an average 1.3 million kg tea is produced from own leaf.

Addabarie is situated in the northern bank of the state, near Tejpur, where 1.5 million kg leaf can be produced.  the sale agreement was signed on Wednesday last.

This is the third transaction between the two groups.. In June last year, Luxmi bought four gardens in Moran area in Dibrugarh district of upper Assam for Rs 141 crore. Those gardens can produce 4 million kg of leaf and process another 1 million kg of bought leaf.

The sale of these four estates comes a day after McLeod Russel agreed to sell eight tea estates to M.K. Shah Exports Ltd for ₹ 331 crore, in what is the biggest sale of tea plantations in India in decades.

The gardens were sold at a rate of Rs 340 per kg of made tea.

Before the latest pact, McLeod had offloaded nearly 38 million kg in production and raked in Rs 790 crore from India and Rs 205 crore from Africa, altering the global pecking order among private tea producers in the world.

Camellia Plc of the UK, the parent of Goodricke Group in India, is now the largest producer of the beverage in the world ahead of McLeod, which is estimated to be left with around 77 million kg of own production.

Mcleod Russel are selling off the garden to acquire cash as they have mounted heaby debt through their engineering arm McNallly Bharat.

"Despite the sale, the Khaitans continue to own some of the best gardens in Assam and one can argue the gardens they still holding on to are definitely more profitable than those were sold," the sources added.

While it is not unusual for owners to rejig their portfolio of gardens, it has so far been a one-way street for McLeod. Luxmi Tea also recently sold two gardens, in Assam (Lengrai estate) and Dooars (Matelli) in Bengal for Rs 60 crore.