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Gujarat NRE plans debt recast for unsecured lenders

The scheme is in line with any other typical CDR scheme and involves moratorium and then staggered payment over the years for lenders with Rs 215 crore exposure

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Beleaguered met coke maker Gujarat NRE is going for separate debt restructuring deal with its unsecured creditors and those who weren't part of the earlier corporate debt restructuring (CDR) done for the banks and financial institutions.

The CDR initiative of the banking sector largely took care of the interest of the secured creditors, most of whom were either scheduled banks and financial institutions.

Now it's time for the unsecured lenders and those creditors who weren't part of the CDR mechanism to get some reprieve.

"We are going for a court-convened meeting with those who weren't involved in our CDR process. The rationale is that while the secured creditors including the banks got their exposure restructured and they start getting paid, steps were needed to restructure the loans of the unsecured creditors also," Arun Kumar Jagatramka, chairman cum managing director of Gujarat NRE, told dna.

The meeting was scheduled for Monday but got deferred and would now be held next month.

"Most of them have sought more time to understand the scheme," he said.

The scheme is in line with any other typical CDR scheme and involves moratorium and then staggered payment over the years.

The creditors outside the CDR have an aggregate exposure of Rs 215 crore towards troubled Gujarat NRE, one of the largest independent producers of metallurgical coke in India.

Continued slowdown in steel demand coupled with cheap Chinese imports impacted Gujarat NRE hard.

With an installed capacity of 1.5 million tonne a year and two met coke plants in Khambhalia and Bhachau in Gujarat and the third plant in Dharwad in Karnataka, Gujarat NRE forayed into steel making and power generation through the renewable energy route.

At one time it also nurtured global ambition by acquiring coal and oil assets.

But since 2013, the group has been on a selling spree, divesting its two oil exploration blocks in Australia, and two premium-quality hard coking coal mines in New South Wales.

In 2014, the CDR cell approved Gujarat NRE's proposal for restructuring of its debts over a 10-year period.

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