Wockhardt Ltd, the Mumbai-based company which is battling petitioners seeking approval for sale of its business to Abbott Labs, said the CDR lenders are fully supportive of the company. This is contrary to the reports that secured creditors led by ICICI Bank that stood against the company.

Wockhardt, which has a debt of over Rs 3,700 crore, had undertaken a corporate debt restructuring programme last year. Under the CDR programme, the

pharma company had offered to settle repayment of $110-million FCCBs, issued by it in 2004, at a discount.

Company spokesperson told FE, ?During the hearing in the court on February 26, the secured creditors stood by CDR scheme in support of the company and the counsel of ICICI told the court that it was open for the petitioners who are unsecured creditors to join the CDR in support of the scheme.?

The Mumbai-based company, which failed to pay a clutch of investors, including US-based hedge fund QVT, the $110 million borrowed as foreign currency convertible bonds (FCCBs) in 2004, faced a winding up petition at the Bombay High Court. The petitioners had opposed Wockhardt?s move of selling out its nutritional businesses and a few of its facilities to US-based Abbott for $130 million in cash.

There was a contention by the company that the sale consideration would be deposited in the Trust and Retention Account of the CDR, which was heavily contested by the petitioners ad the FCCB holders, who are unsecured creditors. In response, the secured creditors led by ICICI contend that all rights of security of the secured creditors on the assets being sold will stand transferred to the sale proceeds.

Recently, overseas lenders, led by QVT, had proposed an alternative debt restructuring plan to Wockhardt. Under the new structure suggested by the group, they will exchange the defaulted bonds for fresh foreign currency convertible bonds (FCCBs) with a five-year tenure and at a ratio of 1.29 FCCB for every defaulted bond. QVT and a few other lenders owe Wockhardt around $66 million. QVT had subscribed to about 41% of Wockhardt?s FCCBs.

Wockhardt?s foreign lenders, Barclays and Calyon, had filed winding up petition in November last year to liquidate the assets of the debt-ridden pharma major and distribute its proceeds to lenders.

Though another lender, Singapore-based DBS Bank Ltd, filed another winding up petition against Wockhardt in September, both parties reportedly reached an out-of-court settlement over repayment of Rs 44 crore. Last month, Wockhardt sought a nod from the Bombay HC for sale of the nutrition division. Wockhardt has well known products-Farex, Dexolac and Nusobee infant formulas-in pediatric nutritional category.

Wockhardt is in the process of reducing its piling debt by selling out various businesses. Last year, the company sold out its animal health division to French company, Vetoquinol, for about Rs 170 crore, while its German business, Espharma, was sold out to Mova GmbH, a subsidiary of Lindopharm GmbH, Germany.