The Hindu Business Line : Danish firm keen to revive operations — BIFR stays banks' move to wind up Pennar Profiles

WITH a Danish major coming forward to revive the operations of the ailing Pennar Profiles Ltd (PPL), the Board for Industrial and Financial Reconstruction (BIFR) has directed the financial institutions (FIs) and banks to keep in abeyance the show-cause notice served for winding up of the company.

The BIFR has also asked the banks and FIs to amicably sort out the sharing pattern for their outstanding dues from the one time settlement (OTS) amount offered by the Danish firm, a PPL official told Business Line.

Three bids were received for the takeover of the company's management, in response to the operating agency's advertisement for rehabilitation along with proposals to settle the dues of secured creditors.

Of these, a German company's bid was the highest. It offered to pay Rs 10.3 crore as OTS to all secured creditors against their dues. However, the banks and FIs rejected all the bids and recommended winding up of the company to BIFR.

Following this, the Industrial Development Bank of India (IDBI) appointed S.B. Billimoria & Company to evaluate the maximum amount that the secured creditors could recover in the event the company was wound up and its assets were sold.

In the meantime, the PPL promoters along with the Danish company submitted a fresh rehabilitation proposal offering OTS and upfront payment of Rs 10.92 crore to the secured creditors.

They also expressed willingness to invest Rs 4.8 crore for modernising the plant and machinery. Further, the Danish company also offered to arrange working capital to run the plant without seeking any support from the company's bankers. The proposal also involved settling the company's other liabilities, including restructuring of equity capital with prior approval of BIFR.

Meanwhile, the IDBI received the valuation report from Billimoria & Company wherein it was found that the Danish company's offer for OTS payment of Rs 10.92 crore was higher than the value that could be realised by the secured credits in the event of the company was wound up and assets were sold away.

"The banks and FIs are yet to take a decision on the proposals submitted by the Danish company for the rehabilitation of the company," the official said.

More Stories on : Sick Units | Regulatory Bodies & Rulings

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
IOC may resume operations at Rajbandh tomorrow

BPCL plans 10 recreational fuel outlets

Madras Fert to market insurance products

Rajasthan Spg mulls pref. issue

Danish firm keen to revive operations — BIFR stays banks' move to wind up Pennar Profiles

Power cut on Mardia units

Tata Motors positive on Rs 1 lakh car plan

S. Kumars' Reid & Taylor brand may post Rs 170-cr sales

`Madras Fert networth hit by urea pricing policy'