A court order has prevented textile maker Alok Industries from selling its assets or changing its equity structure till a winding up petition filed by HSBC against the company is settled. The court set the date for next hearing on April 6.
HSBC has filed a petition on behalf of a consortium of unsecured lenders led by VTB Capital, to liquidate Alok Industries and settle outstanding dues of $55 million from a loan of $125 million that the company had taken. For it, the company had offered guarantee in an off-shore holding company which has no assets that can be seized by these lenders.
Alok Industries is in the process of undergoing a strategic debt restructuring in which a joint forum of 25 banks led by State Bank of India that lent around Rs 13,000 crores to the company decided in January to convert the loans into a 65 per cent equity stake.
SBI Capital Markets has since been mandated to run a formal auction process to sell the core businesses as a whole or in parts, and had called an extraordinary general meeting earlier this week.
While the process is aimed at repayment of secured lenders, mostly public sector banks, it has no proposals for unsecured lenders, who as the term suggests rank lower in the repayment scheme.