Edelweiss Asset Reconstruction Company (ARC) is planning to move the National Company Law Tribunal (NCLT) to seek recast of Rs 1,800-crore debt of Karaikal Port (KPPL), sources told FE, adding that the ARC has appointed E&Y to look after the company’s cash management.
According to sources, Edelweiss’ recast plan follows the failure to sell 51% in the company to Shapoorji Pallonji for Rs 900 crore. “Several reasons led to the failure of the deal, including the promoter’s unwillingness to sell 26% stake since it’s part of the original concession agreement with the Puducherry government,” another source said.
He added that the ARC is looking to effect a change of management as well. “The only way, at present, to do it is through the NCLT,” he explained, adding that the restructuring package is still being discussed and has to be submitted to a panel of creditors.
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In June last year, the erstwhile Company Law Board was replaced by the NCLT, which has since been hearing winding up petitions and clearing corporate restructuring cases.
Developed by the Chennai-based MARG Group, the port was used by infrastructure development company IL&FS to bring coal for its thermal power project near the port, and by the Tamil Nadu Electricity Board.
However, owing to paucity of traffic, the company faced a problem in the cash flow.