Adhunik Metaliks, the flagship of the Adhunik Group, could be staring at liquidation soon as no resolution plan for the insolvent company has been approved by its lenders till date. For the company, the mandated 270-day deadline under the corporate insolvency resolution process (CIRP) will end on April 29.
The Kolkata bench of the National Company Law Tribunal (NCLT) is scheduled to hear the matter on May 1, when the fate of the steel maker will be decided. “No resolution plan has been approved for the company till date. And the committee of creditors (CoC) has no time left to consider any plan further,” a source close to the development told FE.
According to sources, apart from the UK-based Liberty House, there was only one resolution applicant for Adhunik Metaliks. The lenders to the bankrupt firm decided that Liberty House’s resolution plan may be ineligible under Section 29A of Insolvency and Bankruptcy Code (IBC). The lenders had sought information from the company on its reported outstanding loans to EXIM Bank and asked why it did not mention this in its bidding documents.
“Liberty House was H1 (highest bidder) here. Although the company has given a reply to the clarifications on the loan, it is too late. Now, the CoC cannot even consider the resolution plan submitted by H2,” the sources cited above said.
“After giving the clarifications, we are now awaiting next intimation from the resolution professional,” said a Liberty House spokesperson. Sumit Binani, the resolution professional, was unavailable for a comment.
Bankruptcy proceedings against Adhunik Metaliks, its subsidiary Orissa Manganese & Minerals and group companies Zion Steel and Adhunik Alloys & Power, were admitted by the Kolkata bench of NCLT in August last year. The insolvency petition had been filed by State Bank of India (SBI).
SBI, which leads the consortium of lenders to the companies, had in July last year filed insolvency petitions over non-payment of loans worth about Rs 940 crore by Orissa Manganese & Minerals (OMML) and Rs 812 crore by Adhunik Metaliks (AML). The bank had also claimed dues from Zion Steel, as it was a co-obligator to the loans disbursed to OMML and AML under the provisions of the master restructuring agreement and the common loan agreement signed in March 2014.