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Wednesday, Oct 13, 2004

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Arch Pharmalabs out of BIFR purview

Richa Mishra

New Delhi , Oct. 12

MERVEN Drug Products Ltd (MDPL), now known as Arch Pharmalabs Ltd, has come out of the Board for Industrial and Financial Reconstruction (BIFR) purview.

At the recent hearing, the BIFR bench noted that the total net worth of the company was positive by Rs 33.38 crore (after excluding the share application money of Rs 21.92 lakh) as on March 31, 2004.

The board had sanctioned a rehabilitation scheme in August 2003 for the Andhra Pradesh-based ailing bulk drug manufacturer, Merven Drug Products Ltd (MDPL) envisaging reverse merger of a healthy Mumbai-based pharma company Arch Commerz Pvt Ltd, with the sick Merven Drug, a listed company. The company has now been renamed as Arch Pharmalabs.

The company, vide a letter dated June 1, 2004, enclosed a formal application for de-registration of the ailing MDPL stating that its net worth has turned positive as on March 31, 2004. The BIFR bench observed that the Industrial Development Bank of India (IDBI), the monitoring agency, has submitted that the company has cleared all the one-time settlement (OTS) dues and complied with all terms and conditions.

It had recommended to the bench to consider the company's request to de-register from the purview of Sick Industrial Companies (Special Provisions) Act.

On review of the chartered accountant's certificate that the company has paid all dues with interest to full and final settlement as agreed under OTS agreement entered by it with the secured lenders — IDBI, State Bank of Hyderabad, and Bank of Baroda, and that the company's net worth has turned positive, the bench directed that "the case is no longer required to be dealt with BIFR."

The bench, however, directed that the unfulfilled obligations under the sanctioned scheme, if any, would continue to remain in force for the unexpired period of the scheme and discharged as per directions contained in the scheme. Mr K.S. Baidwan, who was appointed as special director by BIFR on the board of the company would stand discharged, the order said.

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Arch Pharmalabs out of BIFR purview

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