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RP invites resolution plan for Orchid Pharma

The resolution professional (RP) for the debt-laden Orchid Pharma, which has been brought under the insolvency process by the Chennai bench of the National Company Law Tribunal (NCLT), has called for expressions of interest (EoIs) from potential investors for the purpose of submission of the resolution plan in accordance with the Insolvency and Bankruptcy Code,…

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Orchid had borrowed Rs 50 crore from Lakshmi Vilas Bank and defaulted on the repayment, according to the order.

The resolution professional (RP) for the debt-laden Orchid Pharma, which has been brought under the insolvency process by the Chennai bench of the National Company Law Tribunal (NCLT), has called for expressions of interest (EoIs) from potential investors for the purpose of submission of the resolution plan in accordance with the Insolvency and Bankruptcy Code, 2016. The NCLT’s Chennai bench in August had ordered commencement of the corporate insolvency resolution process against the Chennai-based company, a key player in injectables and active pharmaceutical ingredients (API) in its heydays. The company, which has been going through the debt-related crisis for the past few years, with the creditors taking it to various forums demanding debt restructuring as well as getting the payment recovered. It was also under the corporate debt restructuring (CDR) scheme. Admitting a petition filed by an operational creditor Lakshmi Vilas Bank, the NCLT had issued an order to appoint an IRP to take charge of the management Orchid Pharma with effect from August 17, 2017.

Orchid had borrowed Rs 50 crore from Lakshmi Vilas Bank and defaulted on the repayment, according to the order. Responding to the NCLT order, the company had then said it was in the process of exploring suitable legal recourse including preferring an appeal before the National Company Law Appellate Tribunal (NCLAT). However, at a meeting of the committee of creditors in October last, a new RP was appointed replacing the IRP. The RP in a public notice said it was inviting expressions of interest (EoIs) for resolution of plan in accordance with the IBC Code from financial investors including mutual funds, private equity/venture capital funds, domestic and foreign institutional investors, non-banking finance companies, asset reconstruction companies, banks and similar entities with a minimum consolidated net worth of Rs 100 crore at group level as on the previous fiscal. According to the annual report for 2016-17, the total debt was to the tune of Rs 3,200 crore.

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First published on: 18-11-2017 at 04:45 IST
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