The Mumbai chapter of the National Company Law Tribunal (NCLT) last week admitted textiles and apparel company S Kumars NationwideNSE 20.00 % for insolvency proceedings after the state-owned IDBI Bank filed an application to recover about Rs 1,700 crore in unpaid loans.
The company, which owned the premium brand Reid & Taylor in India, has total dues of about Rs 2,500 crore to financial creditors. Other lenders to the company include JM FinancialNSE -0.36 %, Punjab National Bank, Central Bank of India, Union Bank of India and Arcil.
Abhay Manudhane has been appointed as the interim resolution professional (IRP).
“In just two hearings, the NCLT court has admitted the S Kumars insolvency case. A committee of creditors led by IDBI Bank, which is my client, is likely to meet soon,” said Nishit Dhruva, managing director of MDP Partners, a legal firm that represented IDBI Bank at Mumbai NCLT.
An email sent to IDBI Bank remained unanswered until the publication of this report.
In the next 180 days, S Kumars’ creditors will have to settle the loan. The exercise will either end up reviving the company through a successful resolution plan or force the borrower into liquidation, under the stewardship of the resolution professional. The court may grant another 90 additional days if it sees some viable progress in the matter.
IDBI Bank had initiated the insolvency proceedings against S. Kumars Nationwide, the parent company, while Edelweiss Asset Reconstruction Company dragged Reid & Taylor (India), a subsidiary, to insolvency court, ET reported on March 9 this year.
Nitin Kasliwal, promoter of S. Kumars Nationwide, is declared a wilful defaulter by most lenders and will thus not be eligible to participate in the resolution plan.
Last year, lenders had also filed a case in the Debts Recovery Tribunal in Bangalore.
In the first week of April, Reid & Taylor India too has been admitted for insolvency and bankruptcy proceedings at the NCLT, Mumbai.