Lenders to Adhunik Metaliks, the flagship company of Kolkata-based Adhunik Group, have referred the company to the National Company Law Tribunal (NCLT) over non-payment of loans worth around Rs 5,000 crore, sources told FE. According to two senior bankers, lenders led by State Bank of India (SBI) have discussed the matter and SBI has got a mandate from majority of banks. “We had attempted to convert a portion of the company’s debt into equity through strategic debt restructuring (SDR), but the conversion could not be done within the deadline,” he said.
The banker added that the SDR had failed because lenders could not find an investor for the company. In FY17, the company reported a net loss of Rs 1,480 crore on the back of Rs 1,221 crore in revenues. Its consolidated gross debt stood at Rs 4,682 crore. Bankers to the company include Allahabad Bank, Bank of Baroda, Bank of Maharashtra, Corporation Bank, HDFC Bank, ICICI Bank, Indian Overseas Bank, Punjab National Bank, State Bank of India (SBI) and its subsidiaries, among others.
The company is engaged in manufacturing of alloy and carbon steel products catering to the auto, power and engineering sectors. An email sent to the company seeking comments remained unanswered. In 2013, the board of Adhunik Metaliks had approved the new corporate structure for the company, wherein Zion Steel (the promoter group company) will first be merged with Adhunik Metaliks. After that, Adhunik Metaliks (the listed entity) will be reverse merged with its wholly owned subsidiary Orissa Manganese & Minerals (OMML). Adhunik Metalik’s loans were restructured by the corporate debt restructuring (CDR) cell on March 18, 2015.
Meanwhile, the RBI on June 13 had asked banks to refer a dozen troubled companies – with a combined debt of close to Rs 2.4 lakh crore – to the NCLT. Bankers were given a fortnight from the notification to move the tribunal. Among the other companies that have been refereed to the NCLT are Essar Steel, Bhushan Steel, Electrosteel Steels, Jyoti Structures, Lanco Infratech, Monnet Ispat and JP Infratech.
The 12 accounts, identified by the central bank are those to which banks have an exposure of more than Rs 5,000 crore, more than 60% of which has been recognised as NPAs. Once these cases are with the NCLT, the lenders need to set up a committee of creditors that will come up with a plan on how the asset will be tackled. If the committee is unable to find a solution within 180 days — this can be extended to 270 days — the borrowing entity will go into liquidation.