Carbon Resources on Thursday exited tea major McLeod Russel, having sold all its shares in the Khaitans-led debt-laden company through open market transactions.
Carbon products manufacturer Carbon Resources sold 1.4 million shares of the tea maker in the open market at Rs 22.18 apiece on Thursday, according to BSE data. The company’s scrip ended the day at Rs 22.30, up 9.96% from previous close.
Carbon Resources had picked up a 5.03% stake in McLeod Russel from the open market in September last year.
McLeod’s board of directors had approved the execution of an “exclusivity agreement’ with Carbon Resources in January to negotiate and evaluate a mutually agreeable mechanism for the company to offer a proposed “one-time settlement “ of its debt to lenders.
“We sold all our shares of McLeod Russel. We exited today,” Abhinav Jalan, director, Carbon Resources, told FE.
“In all practical purposes our exclusivity agreement with McLeod had expired as the company went into insolvency proceedings. When the company came out of the insolvency proceedings recently, we held a meeting with the Khaitans. They were not interested in honouring the agreement that we had. So, we exited,” Jalan said.
The Kolkata bench of the NCLT on February 10 admitted IL&FS Infrastructure Debt Fund’s insolvency petition for initiating CIRP against Mcleod Russel. IL&FS Infra Asset Management, an asset management company, manages IL&FS Infrastructure Debt Fund (IIDF). IIDF, a financial creditor to McLeod, had filed the petition under Section 7 of the Insolvency and Bankruptcy Code against the company for a default in payment of `347.47 crore as on November 12, 2019.
Aditya Khaitan, the promoter of the tea major, moved the National Company Law Appellate Tribunal (NCLAT) against the NCLT’s order. Last month NCLAT allowed IL&FS to withdraw applications against the company after an out-of-court settlement.
The Khaitans have a 6.25% stake in Mcleod Russel, whose debt stands at over Rs 1,700 crore. The lenders to the company are ICICI Bank, State Bank of India, Indian Bank, RBL Bank, Axis Bank, HDFC Bank, UCO Bank, Punjab National Bank, Yes Bank and IndusInd Bank.