Mumbai: Port-based logistics company Arshiya International Ltd, said on Monday, it is initiating a financial restructuring process under the corporate debt restructuring (CDR) forum and has appointed merchant banker SBI Capital Markets Ltd as its adviser.
During morning trade, the company’s shares fell 4.91% to Rs.46.45 per share on Monday on the BSE, while the benchmark index, Sensex gained 0.31% to 20,104.33 points. Since 9 January, the company’s shares have fallen 49.85%.
Troubled loans are usually referred to the corporate debt restructuring (CDR) cell of the lenders after a majority of them approve a recast, which could entail a lower interest rate, a longer repayment period, or the conversion of overdue interest into the loan principal. This is done after a loan turns bad.
According to the stock exchange filing on Monday, the management and board have also decided to appoint an independent professional firm to submit its report to the audit committee of the board of directors.
As a part of a manpower rationalisation exercise, the Mumbai-based logistics company had sacked over 150 employees, including some of senior staff since the first week of this month on shrinking orders.
Following this, a section of employees in its free trade warehousing zone at Panvel (near Mumbai) and at Khurja (Uttar Pradesh) went on strike, alleging non-payment of salaries and termination process.
As the company grapples with declining orders and debt, its promoters have decided to forego 50% of their remuneration from 1 October 2012. “The executive director and chief financial officer has also decided to forego 50% of his remuneration from 1 October 2012,” the company said in a filing to BSE Ltd.
Last week, Ajay S. Mittal, group chairman and managing director of Arshiya told Mint that the company did sack employees but there were no salary payment issues.
Arshiya presently operates two Free Trade & Warehousing Zones (FTWZs) across West (Mumbai—Panvel) and North (Khurja—in the state of Uttar Pradesh) near New Delhi.