Itís Winsome, lose all for bankers to jewellery firm

Sep 16 2013, 03:24 IST
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SummaryPromoters havenít brought in Rs 250 cr to allow recast

The Winsome account is turning out to be another Kingfisher Airlines for bankers who have been left in the lurch with no collateral for a R6,000-crore exposure to the group. Lenders who had insisted that promoter Jatin Mehta, who had stepped down as chairman last year, return to the board have not been able to get him to do so.

Moreover, the promoters of the Winsome group have not brought in R250 crore to allow a recast of its R6,000-crore debt.

Ramesh Parikh, director of finance, Winsome Diamonds, claimed that negative news flow has prevented the promoters from mobilising the R250 crore. Cash flows at the jewellery firm collapsed after it reportedly failed to receive payments for exports gold jewellery. Stranded without the gold, which was the collateral against which banks had opened letters of credit, the consortium of lenders is readying to write off the exposure.

While Punjab National Bank, the leader of the 15-bank consortium, is yet to take a call on whether the loan should be recast via the corporate debt restructuring (CDR) cell, the fact that the promoters havenít come up with their contribution of R250 crore could compel the banks to write off the money. ďIf the company canít bring in R250 crore, how can we expect it to repay R6,000 crore?Ē said a senior executive at Central Bank of India.

The CDR cell meets later this month, on September 24, to take a final call but itís unlikely a recast will be okayed.

Most lenders have already classified Winsome Diamonds' Rs 4,000-crore exposure and Forever Precious Jewellery & Diamonds' Rs 2,000-crore loan as non-performing assets and have provided for it.

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