The committee of creditors (CoC) for Chennai-based Orchid Pharma has approved the resolution plan from Ingen Capital Group. The resolution professional (RP) will be submitting the CoC-approved resolution plan to the Chennai bench of the National Company Law Tribunal (NCLT), Orchid Pharma said in filing to the stock exchanges, on Monday.
Ingen Capital is a manager of fixed income and distressed asset funds that invest globally in transportation infrastructure, renewable power utilities and healthcare. The financial details of the bid were not available immediately.
Admitting a petition filed by one of the operational creditors, Lakshmi Vilas Bank, the NCLT had in August, 2017 issued an order to begin the process of insolvency of Orchid Pharma, once a key player in injectables and active pharmaceutical ingredients (API). The CoC had in April this year rejected three bids received when the lenders panel were not satisfied with the ‘quality of offering’, and subsequently authorised the RP to initiate fresh bidding process. Orchid has a total debt of around Rs 3,500 crore from a slew of banks.
Orchid Pharma had been facing severe financial crisis with lenders and investors approaching legal fora for a remedy and was brought under the corporate debt restructuring scheme, initiated during 2013, for the revival of its operations.
The CoC has considered the resolution plan of Ingen Capital Group, an alternate asset manager with expertise in the infrastructure, energy and healthcare sectors, in its meeting on June 4 and the plan received an affirmative vote of 78.64% of the CoC by value in its favour, said the filing.
“As the resolution plan of Ingen Capital Group LLC has been approved by the CoC, the RP (Resolution Plan) will be submitting the approved resolution plan to the Hon’ble NCLT in accordance with Section 30(6) of the Insolvency and Bankruptcy Code, 2016,” said filing.
According industry watchers, one attraction for the investors to look at Orchid Pharma was its ability to augment the capacity relatively faster because of the fact that it has a USFDA-approved facility already, in Tamil Nadu. The company has a generics oral formulations facility in Irungattukottai and an antibiotic (cephalosporin) active pharmaceutical ingredient manufacturing facility in Alathur, Tamil Nadu, apart from another oral formulations facility emerging in this location.
Orchid Pharma had sold its generic injectables business to the US-based Hospira Healthcare, which was later acquired by Pfizer, in 2009 for a consideration of $400 million. In 2012, the company also announced the sale of its carbapenem and penicillin API-manufacturing facility in Aurangabad, along with the related research and development facility in Chennai and the product pipeline, to Hospira for a consideration of $200 million.
