NIRMAL, MAKING OF A KNOWLEDGE PARK

THERE WERE PERHAPS ONLY A FEW INSTANCES WHEN I FELT the pull of becoming a part of a business venture in my home state Kerala, somehow too hard to resist. It was not a greenfield venture and my role was to bail out a project that was clearly in trouble. First, some background.

Nirmal Agro Industries was a venture started by Fr Joy Aram-banakudy inside the Kerala Industrial Infrastructure Development Corporation (KINFRA) facility in Kakkanad. In 2003, he raised Rs 13 crore from NRIs, mostly from Keralites settled in the US with a plan to start an export-oriented pineapple processing facility. The investors came on board as there was then a serious market for canned pineapples in the US. On the other end, was the huge pineapple farming belt in Vazhakkulam situated just over 40 km or an hour's drive from the proposed processing plant. On paper, it was a great project.

By 2010, the project had run out of working capital and the pineapple processing plant was far from a reality. It was then that Kalathil Pappachen, a former FOKANA president, brought me into the picture. I was briefed that there was a viable project in Kochi that needed not only an infusion of fresh funds but also the guiding hands of a seasoned businessman to safely steer it out of troubled waters. The government of Kerala was owed Rs 50 lakh, primarily towards lease payable, for the 7-acre property that was assigned to Nirmal Agro Industries.

I played the quintessential role of the white knight, handing over a check for $100,000.00 against shares in the company at a face value of Rs 10 per share. Over the next couple of years, many of the original promoters moved out, as the credibility of Nirmal Agro was ruined by the failure of the pineapple processing plant to take off. It had defaulted on its payments to a few banks from which the promoters had borrowed heavily. Consequently, the banks had black-listed Nirmal Agro, ensuring the project would not get any further loans.

Dr Stephen Puthumana, another US-based businessman with multiple ongoing ventures, who then became its Managing Director, persuaded Fr Arambanakudy to step down as chairman and insisted that I be made the chairman of the company. The change of guard and the fresh infusion of funds alone would not have amounted to much unless the new management could forge a new path forward. A quick evaluation of the pineapple processing project found it to be wanting on the financial viability front.

Thus, it was decided that the venture would move into the IT sector and the company name was changed from Nirmal Agro to Nirmal Infopark. The new venture floated the first incubation center in Kochi and it was perceived to be a good business model.

Soon, an educational school by the name of Shadwell's, with its base in the UK, approached the MD and they were given space to run an educational campus. This business model flourished for some time before Mr. Tom Baby, who was the chief representative for Shadwell's in Kochi, ran into financial problems and got involved in a human trafficking case. Result: Shadwell's Kochi unit came precariously close to getting shut down.

Dr Stephen approached me, citing the sorry plight of about 350 students enrolled with Shadwell's, convinced me that it would in the best interest of all to salvage the situation by lending Rs 1 crore to Mr. Baby. I agreed to Stephen's request to share the burden though I did not personally know Mr. Baby.

Thereafter, there were multiple issues, with Shadwell's dropping out of the equation and the school was renamed Indian School of Commerce under the banner ISDC and Mr. Tom Baby came back into the picture, this time as Mr. Tom Joseph by taking over the reins of ISDC
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With the influx of large corporations making IT buildings in the neighborhood, the future of Nirmal Infopark in IT came under a cloud. Soon, Tom convinced Stephen that the business model should be changed from an IT park into an educational campus, and he would help bring the Bangalore-based Jain University into the campus.

I supported Stephen's proposal and stood with him in convincing the board of directors that it would be the right decision to convert Nirmal Infopark into an educational park. Once this was done and we approached KINFRA for the same, we were bestowed with the label 'Knowledge Park'. But there was a downside to our arrange-ment with Jain University, which we came to realize much later.

Tom, in whom Stephen had full faith, was allowed to interact directly with the Jain University management, on our behalf. Things came to the stage when Tom felt emboldened to present himself to the outside world as the face of Nirmal Park. But by this time he had fallen out with Stephen.

This was followed by a hostile takeover bid by Tom where he started planting negative stories in the media about the NRI owners of Nirmal Park, including me and other senior directors. Fortunately, we also had our contacts in the media and they retracted the false allegations and apologized.

What followed was an intense legal battle that was fought simultaneously in Kerala in High Court and the National Com-pany Law Tribunal. It was only a matter of time before the truth emerged resulting in ISDC and all its ancillary units controlled by Tom getting evicted from the Nirmal Park campus.

It was a trying period for both Stephen and me. It was my word and assurance to other directors that even if the campus had to be shut down, all liabilities owed to the banks in lieu of constructing the college campus would be borne by me.

True, most of the directors were in the US and it was mostly Stephen who found time to be in Kochi, fighting the battle on behalf of the rest. As Stephen reminded the board of directors, once the false claim of Tom regarding the ownership of Nirmal Park got vacated by the High Court, "If it was not for the blind support and faith reposed by John Titus, this company would not have been where it is today".

Today, Jain University is the primary client of Nirmal Knowledge Park. The success of this association is reflected in the fact that over its five years as a tenant, Jain is now occupying 2,00,000 sq ft of space built by Nirmal Park. And they have signed an agreement that they would be ready for taking on an additional 3,50,000 sq ft for their University campus in the next three years.

This has been my only business venture in India, apart from the Heritage Hotel I have built in Kumbanad, which was more of a family venture. The Nirmal Knowledge Park turnaround has been far from smooth sailing as it came with a fair share of boardroom brawls and protracted legal battles. The fact that we have a successful venture going in India is a matter of pride. But I am not too sure if I would do another such project again, either in India or the US!

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