The creditors of Amtek Auto are expected to meet soon to discuss the way out for the loss-making auto components maker. According to bankers, there has been some interest from investors, both strategic and financial. The total debt at end of March 31, 2016 was Rs 7,853.39 crore, compared with Rs 8,252.64 crore at the end of the previous financial year, according to data in the annual report for 2015-16. According to a list published on August 17, the total claims filed by creditors, including financial creditors, operational creditors and employees, was Rs 12,722.76 crore. The amount admitted by the NCLT (National Company Law Tribunal) was Rs 12, 321.95 crore. The top three claims filed were by IDBI Bank, State Bank of India and Life Insurance Corporation of India at Rs 1,701.89 crore, Rs 1,107.53 crore and Rs 1,036.37 crore respectively. The company reported a net loss of Rs 862.43 crore in the June quarter on a total revenue of Rs 446.84 crore. In the March quarter, the loss was Rs 230.36 crore while the total revenue was Rs 448.45 crore. In the previous financial year, the net loss stood at Rs 1,494.22 crore, while the total revenue was Rs 1,982.46 crore.
New Delhi-headquartered Amtek Auto was among the companies to be referred to the National Company Law Tribunal (NCLT) for bankruptcy proceedings. On July 24, the NCLT admitted insolvency proceedings against the company and appointed an interim resolution professional (IRP). “There has been some interest in the company and once these prospective investors get more information they could make formal proposals,” the bankers explained. Amtek Auto counts two-wheelers companies and auto-makers such as Hero Moto Corp, Honda Motorcycle and Scooter India, Hyundai Motor, Tata Motors, Mahindra & Mahindra, Ashok Leyland and others as its customers. Its product portfolio include ring gears, machining components, forging components, aluminium high pressure die casting, gravity die casting and casting iron. It has facilities in India, Europe and North America.Because of its diverse product portfolio and strong customer base, Amtek Auto has been able to generate good interest among the potential investors, the source added.
Financial trouble started brewing for Amtek Auto as multiple acquisitions, both in India and overseas, squeezed its cash flows. The firm defaulted on payments on Rs 800 crore of bonds in September 2015. The IRP (Interim Resolution Professional) had invited expressions of interest for investment opportunity in Amtek Auto from resolution applicants by September 11. Minimum conditions for corporate applicants included minimum net worth of Rs 1,000 crore at the group level as on March 31, 2017, minimum consolidated group revenue of Rs 2,000 crore for any of the preceeding three financial years and good financial health and repute. Minimum conditions for financial institutions and PE investors included minimum asset under management or funds deployed of Rs 3,000 crore during last 5 years as on December 31, 2016, or committed funds available for investments of Rs 3,000 crore or more as on December 31, 2016. On July 29, the IRP had, through a public announcement, asked the creditors to submit a proof of their claims on or before August 10. In June, the RBI’s Internal Advisory Committee (IAC) had said 12 accounts totaling about 25% of the Rs 8 lakh crore non-performing assets of the Indian banking sector would qualify for immediate reference under the Insolvency and Bankruptcy Code (IBC).
Of these, R6 lakh crore are with the state-run banks.Subsequently, Jyoti Structures, Essar Steel, Monnet Ispat and Energy, Alok Industries, Electrosteel Steels, Amtek Auto, Bhushan Steel, Bhushan Power and Steel, ABG Shipyard, Lanco Infratech and Jaypee Infratech have been admitted by the NCLT.