Gujarat NRE Coke promoter hopes favourable NCLAT outcome

The promoter of Gujarat NRE Coke Ltd is expecting a positive outcome from the National Company Law Appellate Tribunal (NCLAT).

"We are expecting a proper order from NCLAT to move forward on Sec 230 of the Companies Act in the next hearing on October 8," the company Promoter and Chairman Arun Jagatramka told PTI.

Jagatramka had submitted a proposal under Section 230 of the Companies Act before the NCLAT Kolkata bench to revive the firm which employs 1,100 people.

The NCLAT had accepted the proposal of Jagatramka on May 15 and had ordered to convene a meeting of all the stakeholders on July 16.

The Jindal Steel & Power Ltd, an unsecured creditor with only 0.5 per cent of the total debts of Gujarat NRE Coke, has obtained an ex-parte order of NCLAT on July 12 to stay the meeting scheduled on July 16.

A stay order just a day ahead of the meet of the lenders and shareholders of Gujarat NRE Coke Ltd cast a shadow on the future of the debt-laden firm which found no takers under the IBC.

Earlier, Gujarat NRE Coke had failed to get any suitor for resolution under the Insolvency and Bankruptcy Code (IBC) as no plan was accepted by its secured creditors.

"I am always optimistic," Jagatramka had said earlier.

The beleaguered metallurgical coke producer owes about Rs 5,000 crore to secured and unsecured creditors while the liquidation value of the company was put at Rs 350 crore. The company had voluntarily moved the NCLAT last year.

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According to a proposal of the promoter family of Jagatramka has promised to repay Rs 3,501 crore of secured financial creditors through a mix of long term debt and equity reducing the company's equity shares by 90 per cent and paying part of FCCB holders and unsecured creditors as settlement.