Corporate Grapevine

Published: Dec 29, 2021
Updated: Dec 29, 2021

Hapless lenders take Sintex to NCLT

The Ahmedabad bench of the National Company Law Tribunal (NCLT) has admitted an insolvency petition against textile company Sintex Industries after it failed to pay over Rs 7,000 crore to a group of lenders led by Punjab National Bank – the company owes PNB Rs 1,203 crore. Other lenders include Bank of Baroda, Bank of India and Union Bank of India. Of course, knowing well that approaching NCLT involves a lot of delay, the lenders tried their best to settle the issue by offering the textile company to the Welspun group – one of the parties interested in taking over Sintex. But Welspun insisted on a 74 per cent haircut. It is said that Welspun offered only Rs 1,800 crore against the debt of Rs 7,000 crore. Besides, the payment period was a stretched-out one, and the lenders could not accept such a proposition.

Besides Mr Balkrishan Goenka of Welspun, there were other bidders like Rajinder Gupta of the Trident group, Paul Oswal of the Vardhman group and even Mukesh Ambani of Reliance Industries. But as none of the others went beyond the offer made by Mr Goenka of Welspun, the lenders decided to take Sintex to NCLT even though they were reluctant to do so. Besides, Mr Ambani is well- known for touching a company only if it is available at a throwaway price (example, Alok Industries). Needless to say, the lenders were not charmed by the offers of the other bidders. It is now gathered that even Amit Patel, the Managing Director himself is trying to retain the company by staging a come back.

As is well-known, NCLT takes its own time to decide such issues, and one can be sure that as the time passes, there will be more bidders besides the current four for Sintex Industries. The company may be insolvent but it still carries the attraction of a well-equipped textile unit with state-of-the-art machinery.