BackNCLT to hear insolvency pleas against ABG Shipyard, Amtek Auto today
ABG Shipyard and Amtek Auto are among 12 companies identified by RBI's internal panel, where banks have been asked to initiate insolvency proceedings
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Mumbai: The National Company Law Tribunal (NCLT) will on Thursday hear insolvency applications against ABG Shipyard and Amtek Auto.
The two companies are among the 12 identified by the Reserve Bank of India’s (RBI) internal panel, where banks have been asked to initiate insolvency proceedings.
ICICI Bank’s application against ABG Shipyard will be heard at the Ahmedabad bench of NCLT, while the Chandigarh bench will hear Corporation Bank’s plea against Amtek Auto.
So far, various NCLT benches have admitted proceedings against Jyoti Structures, Monnet Ispat & Energy and Alok Industries.
ABG Shipyard defaulted on loan repayments because its financials were impacted due to issues faced by the shipping sector. In 2013, the company was referred to the corporate debt restructuring cell. However, the financial woes of the ship builder continued and banks decided to invoke provisions of strategic debt restructuring.
ICICI Bank-led consortiums of lenders have been trying to sell their majority stake in ABG Shipyard but with no success, even though many potential investors have expressed interest, according to reports.
Similarly, Amtek Auto has been facing stress on its financials since two years because of cash flow mismatch. The auto component maker had been trying to sell various group businesses to reduce the debt on its books, ever since it defaulted on its bond payment of Rs800 crore in September 2015. According to a 15 March Mint report, lenders to the company asked it to either repay loans or convert the outstanding into equity shares or warrants.
Global private equity giant KKR has launched bankruptcy proceedings against Amtek Auto’s Singapore-based subsidiary Amtek Global Technologies Pte. Ltd, Mint reported on Wednesday. The company owes KKR close to $450 million in debt.
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