Financial Daily from THE HINDU group of publications
Tuesday, Sep 27, 2005
Financial Daily from THE HINDU group of publications Tuesday, Sep 27, 2005 |
|
|
|
|
|
Corporate
-
Regulatory Bodies & Rulings AAIFR to hear Dunlop revival scheme on Oct 4 Our Bureau
Kolkata , Sept 26 THE next hearing of the Appellate Authority for Industrial and Financial Reconstruction (AAIFR) on finalisation of a revival scheme for the ailing Dunlop India Ltd (DIL) will be held on October 4. The constituted bench of AAIFR will hear the revised detailed rehabilitation scheme (DRS) for the company, prepared by SBI, which is the Operating Agency. Stating this at the 78th AGM of DIL, the company's non-Executive Director, Mr Pramod Balakrishnan, told shareholders that the business parameters considered while drafting the DRS in 2002 had seen a quantum change, particularly owing to the volatility of price of natural rubber, the most critical raw material used by the tyre industry. The demand and supply situation had also changed, which had impacted prices in both the domestic and export markets. The DIL management thus felt the need to re-examine and revise the DRS-02 so as to project the latest picture of the viability of the business. A suggestion to this effect was accepted by AAIFR during its hearing in March 2005. SBI was accordingly asked to revise the DRS, which is now expected to be placed before the AAIFR bench at the next hearing. Mr Balakrishnan said that the company's two manufacturing units at Sahaganj in West Bengal and at Ambattur in Tamil Nadu had remained closed since 2003. As a result, the plant and machinery had been deteriorating with each passing year without much maintenance and upkeep, in the absence of an approved rehabilitation scheme. He was confident that money would not be a problem for restarting operations since the company had enough idle and non-performing assets that could be sold to generate cash. Incidentally, the Assets Sales Committee (ASC), which was constituted by the BIFR in March 2001 for garnering funds for the rehabilitation, has generated funds worth about Rs 67 crore. As directed by AAIFR, this money was deployed for One-time Settlements (OTS) with secured creditors such as banks, debenture holders, and FIs. It was stated that the secured creditors totalling almost Rs 102 crore had been settled on OTS basis with the proceeds form asset sales, thereby reducing the annual interest burden of the company and resulting in write-back of almost of about Rs 63 crore of liabilities. Mr Balakrishnan reminded the shareholders that the company had renewed its agreements with the Ambattur Worker's Union in the last financial year, and the agreements were designed to ensure that the operations of the factory remain cost-competitive. Meanwhile, the DIL management has appointed National Productivity Council, under the Union ministry of commerce, to recommend a suitable business plan to restart the company's operations and to turn it around. The council has worked both in the DIL plants and in the marketplace and its report is expected shortly. He indicated that the updating of the DRS would depend considerably on the recommendations of NPC. The appointment of Mr Deepak Chaudhury as Executive Director of the company was approved by the shareholders at the AGM. Mr Chaudhury will look after day-to-day operations of the company in co-operation with other non-Executive Directors, namely Mr Balakrishnan, Mr R.K. Sandhu, Mr A.K. Kapur, and Mr K.S. Kumar. All directors on the company's board represent the promoters.
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|
