In an interesting turn of events, Carbon Resources, which had made a non-binding offer to McLeod Russel’s lenders to acquire a controlling stake, said on Wednesday that it would support the debt-laden tea major in striking a debt restructuring deal with the lenders. The deal is likely to be in the form of a one- time settlement (OTS). “Mcleod Russel approached us. They want our support for their debt restructuring with the lenders. We are going to support them to settle with the lenders,” Mahendra Sharma, chief of finance at Carbon Resources, told FE.
Earlier this year, Kolkata-based Carbon Resources, which manufactures carbon products, had picked up a 5.03% stake in McLeod from the open market.”Mcleod is in touch with the lenders for OTS. Once lenders agree with it, we would mutually prepare a plan going ahead,” Sharma said when asked about the contours of his company’s proposed “support” to the tea maker. “Our non-binding offer is still with the lenders,” he added.
The Khaitans, the promoter, has only 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
Notably, Mcleod Russel chairman Aditya Khaitan told the company’s shareholders during its annual general meeting, held on September 30, that banks had “concluded” meetings on the terms of what the debt restructuring resolution should be. The company was awaiting necessary clearances from rating agencies.On Wednesday, McLeod’s scrip on BSE
The Kolkata-based carbon products manufacturer had sent a Rs 1,245-crore non-binding offer to the lenders for acquiring a controlling stake in the company, which belongs to the financially stressed Williamson Magor group. According to the offer, Jalans-owned Carbon Resources would infuse upfront equity worth Rs 300 crore and a debt of Rs 945 crore to resolve Mcleod’s outstanding debt. Secured lenders would be paid in full, while unsecured lenders would have to take a 45% haircut as the Jalans proposed to take over the company.MK Shah Exports, India’s largest producer of orthodox varieties of tea, had proposed to extend its support to existing promoters of the tea company in the ongoing restructuring plan.