NCLAT stays lenders & shareholders meet of GJ NRE Coke
Published: Jul 16, 2018
By TIOLCORPLAWS News Service
NEW DELHI, JULY 16, 2018: In a bid to revive the firm one of the promoter of Gujarat NRE Coke submitted a scheme u/s 230 of the Companies Act before the NCLT, which employs 1,100 people. Gujarat NRE Coke voluntarily moved to NCLT last year to refer itself to the Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code. However, the debt-laden firm which found no takers under the IBC.
The scheme would have required at least 75 % voting in favour from secured creditors, FCCB holders, unsecured creditors and shareholders. Gujarat NRE Coke failed to get any suitor for resolution under the IBC as an ongoing concern as no plan was accepted by its secured creditors. The Kolkata Bench of NCLT accepted the scheme proposal by Jagatramka on May 15 and ordered to convene a meeting of all the stakeholders on July 16. Four days prior to the meeting, Naveen Jindal's JSPL stalled the plan by obtaining an ex-parte order from NCLAT to stay the meetings which were scheduled on July 16.
The coke producer owes about Rs 5,000 cr to secured and unsecured creditors while the liquidation value of the company was put at Rs 350 cr. According to the proposed scheme, the promoter family of Jagatramka promised to repay Rs 3,501 cr of secured financial creditors through a mix of long term debt and equity, reducing the company's equity shares by 90 % and paying part of FCCB holders and unsecured creditors as settlement.