The talks between Tamil Nadu government and The Coca-Cola Co (NYSE:KO) over Perundurai have failed as the global beverage leader has decided to withdraw its application for investment worth Rs. 500 crore. As per the reports, the company has asked the state to refund the money it has already pumped into this project.
The Road Ahead:
It’s a shock to Tamil Nadu state as the decision has come just 31 days before the commencement of Tamil Nadu Global Investors’ Meet. While talking to the reporters, one of the state government officials said that the state had decided to cancel the land that was earlier allotted to Hindustan Coca-Cola Beverages Pvt Ltd. He said that the government had given duration of six months to the company to initiate the construction work at the allotted site, but it failed to do so.
The Hindustan Coca-Cola Beverages doesn’t seem to be on the back foot after hearing this decision of the Tamil Nadu government. One of the company officials said that the Hindustan Coca-Cola Beverages had written to the government quite clearly that it could not take things forward in Tamil Nadu. As per the reports, it had written that due to unforeseen delays and pressures it would not be able to invest funds in State Industries Promotion Corporation of Tamil Nadu, based out of Perundurai of Erode district.
Back in 2014, the State Industries Promotion Corporation of Tamil Nadu had allotted 71.3 acres of land to the company for establishing a Rs 500-crore bottling. The Karnataka government had also allotted 250 acres of land at Yadgir, which is located in the North part of the state. The prime objective behind this was to allow the company to establishing a Rs 1,000-crore bottling plant without any hassle. The company official stated that it tried to initiate construction due to enhanced outside pressures and unexpected delays.