Illustration: Binay Sinha
The resolution professional of debt-laden Lanco Infratech on Thursday filed an application with the National Company Law Tribunal (NCLT), Hyderabad Bench, seeking a decision on the fate of the company in the wake of a revised resolution proposal, which was not considered for want of time by the Committee of Creditors (CoC) as the mandatory 270-day period expires on Friday.
The latest development comes after a resolution proposal submitted by Thriveni Earthmovers Private Limited has failed to secure 75 percent votes in its favour from the CoC earlier.
"Since the corporate insolvency resolution period expires on May 4, 2018, the necessary application is being filed by the Resolution Professional with the NCLT, Hyderabad Bench, for liquidation of the company, or for any other direction which the NCLT may deem fit on account of the revised proposal dated May 1, 2018 submitted by Thriveni Earth Movers Private Limited," the company informed the stock exchanges during the day.
According to sources, the Resolution Professional informed the NCLT that the suitor has submitted a revised proposal with an enhanced value even though the CoC could not consider the same as the time was too short.. The NCLT bench will have to take a decision either to allow the liquidation of the company or to extend some more time for the CoC to take a view on the revised proposal as was done in insolvency cases of Essar and Bhushan Steel etc, sources pointed out.
It was reported that Thriveni Earthmovers had offered Rs 1,400 crore in cash and a liability of Rs 380 billion debt at the group level. However, the CoC rejected this proposal recently. The company understood to have told the lenders to keep some of the group level assets with them for a resolution at subsidiary level at a later date considering its resolution plan.
NCLT had initiated insolvency resolution process for Lanco on August 7, 2017 after admitting an application filed under the Insolvency and Bankruptcy Code (IBC), 2016 by the company's lead lender IDBI Bank. The CoC availed the extension of time from the NCLT in February to complete the process. Once the 270-day window allowed to complete the resolution process under the IBC closes the company has to go for liquidation.