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Friday, Dec 10, 2004

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IDBI to advertise for change in Southern Ferro management

Richa Mishra

New Delhi , Dec. 9

SOUTHERN Ferro Ltd (SFL) seems to be set for a management change. The Board for Industrial and Financial Reconstruction has directed IDBI to advertise for change in management of SFL.

Noting that despite the lapse of considerable time and opportunity, the company has failed to submit requisite information to IDBI for finalisation of the revised draft rehabilitation scheme as well as to comply with the its earlier directions, the Board gave these orders.

IDBI, the operating agency (OA), was directed to invite offers for takeover, leasing, amalgamation or merger for rehabilitation as well as for sale of the company on a going concern basis.

This could be with or without some or all liabilities of the company for the purpose of its revival and with or without one-time settlement of the dues of financial institutions and banks, the Board said.

The BIFR bench said, "The present promoters could also submit their fully tied-up offer, with or without a co-promoter, in response to the advertisement within the time limit prescribed. All offers are to be accompanied with an interest bearing `no lien' deposit of Rs 20 lakh to be made to IDBI," the Board stated.

This would demonstrate the resourcefulness of the prospective bidders, it said.

"In the absence of such deposits, which would be refunded to the unsuccessful bidders along with interest, the bids would not be considered," BIFR emphasised. Further, all bids would be accompanied with proof of concrete sources of funds for supporting the rehabilitation proposals, the Board said.

If no concrete rehabilitation proposal with means of finance duly tied-up is received within time in response to the advertisement issued by the OA, the bench may consider passing further appropriate orders, including issuance of show-cause notice for winding up.

SFL commenced operations in 1972 as a partnership firm, to carry on the business of manufacture of rolled products. Later in 1992, it was incorporated as a public limited company. It was declared sick in 1999.

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