The Hindu Business Line : Dunlop hopeful of progress in next AAIFR hearing

Besides the debenture holders, the company has also initiated discussions with its bankers for one-time settlement and the dues of a majority of bankers have been settled.

Kolkata , Sept. 29

THE management of Dunlop India Ltd (DIL) is hopeful of definite "progress" at the next hearing of the Appellate Authority of Industrial and Financial Reconstruction (AAIFR) scheduled on October 11, on the subject relating to finalisation of a rehabilitation scheme for the company.

Addressing shareholders at the company's 77th annual general meeting here on Wednesday, DIL's whole-time director, Mr P. Balakrishnan said, "The setbacks in the past have not in any way affected the management's resolve to revive the company. On the contrary, the efforts of the management have re-doubled over the last one year and significant break-through has been achieved on various fronts."

In fact, the company posted a net profit of Rs 32.67 crore during the year under review following an aggressive drive initiated by the management under the guidance of Assets Sales Committee to dispose of surplus assets. Consequent to sale of assets and the settlement with financial institutions and bankers, a write-back of Rs 73.03 crore has been achieved.

It was pointed out that the company concluded one-time settlement with all financial institutions, which were debenture holders of the company. The settlements were concluded on terms even better than the rehabilitation scheme pending before AAIFR.

Besides the debenture holders, the company has also initiated discussions with its bankers for one-time settlement and the dues of a majority of bankers have been settled.

Mr Balakrishnan said that the company had been able to get almost 10 per cent more than the reserve price fixed by the Assets Sales Committee for most of the properties sold, despite stagnation in the property market last year. Incidentally, the sale of non-performing assets forms a part of the draft rehabilitation scheme (DRS) for the company.

He said that the company had contemplated last year a restart of the operations on interim basis at its factory at Ambattur in Tamil Nadu and had even signed an agreement with the workers' union there. The agreement incorporated measures to align costs to the industry standards, introduction of highest standards of productivity and contracting out non-value added functions.

However, in view of various reasons including high rubber prices and increase in cost of other raw materials, operations could not be commenced at Ambattur.

Further discussions have been held with the Ambattur union to extend the duration of the agreement for another three years. Similarly, the management is also holding discussions with the unions at its factory at Sahaganj in West Bengal but an agreement is yet to be concluded, he said.