Visa SteelBSE -1.46 %, which was taken to the National Company Law Tribunal (NCLT) on January 5 by lead lender State Bank of India for defaulting on Rs 3,600 crore of loans, is pursuing a resettlement plan with its bankers. The proposal includes selling its loans to asset reconstruction companies.
“While SBI has filed an application against Visa Steel at NCLT, the case is yet to be admitted, a process that is likely to take 1-to-2 months. Visa Steel is keen to utilise the time window and is trying to go for a resolution outside the court,” a source close to the development said.
In a statement to the BSE last Friday, informing the exchanges about the application filed by SBI with NCLT’s Kolkata bench to initiate corporate insolvency and bankruptcy proceedings against the company, Visa Steel said: “The company is in discussion with SBI for settlement.”
Incidentally, a similar plan to sell the loans to asset reconstruction companies was approved by its bankers in end-November, 2017, but did not get implemented.
Earlier, the company had been negotiating with its lenders to restructure its debt to a sustainable limit, including waiver of unpaid interest.
Meanwhile the lead banker, SBI, moved the NCLT Kolkata bench last Friday against the company to recover its dues, invoking provisions of the Insolvency and Bankruptcy Code. The steelmaker was on the Reserve Bank of India’s second list of enterprises against whom it had asked lenders to initiate insolvency proceedings.
Incidentally, insolvency proceedings have also been initiated at the Kolkata bench of NCLT against three corporate guarantors of Visa Steel, which include Visa Infrastructure.
Visa Steel, which produces special steels and ferro alloys at Kalinganagar, Odisha, saw its loss widening to Rs 87.61 crore in the April-September 2017 period, compared with Rs 75.43 crore a year earlier.
Source: Economic Times