Industrial Development Bank of India(IDBI) has filed an insolvency application to National Company Law Tribunal(NCLT) against Reliance Naval & Engineering Limited, an Indian Shipbuilding and Heavy industry company headquartered in Mumbai and owned by Anil Ambani.
- Insolvency application filed in Anil Ambani’s Reliance Naval & Engineering Limited for seeking debt resolution under the Insolvency and Bankruptcy Code (IBC)
- IDBI has filed the petition to NCLT over a defaulted loan of Rs 1,250 Crore by Reliance Naval & Engineering Ltd.
- Reliance Naval & Engineering Limited proposed a one-time settlement to its lenders on Set 6 but the lenders have given 10 days to revise its settlement proposal
- The Application will be withdrawn from NCLT, if 90 percent of lenders agree to the revised settlement
- Reliance Naval is under obligation to pay Rs 9,000 Crores to its lenders and Rs 1,250 Crore as loan repayment to IDBI
An insolvency application has been submitted to NCLT by IDBI Bank against Reliance Naval & Engineering Limited owned by Anil Ambani. IDBI bank has filed the petition as Reliance Naval & Engineering Ltd. is defaulting on a loan of Rs 1,250 Crore. It has approached NCLT to initiate a resolution process to get the repayment of the loan amount.
On February 12 2018, Reserve bank of India published a circular that gave banks a six- month-period to resolve debt for corporate accounts that were in default by even a day. If that resolution could not be settled in the six months interval, then lenders can drag the defaulting company to NCLT to start the insolvency and bankruptcy.
Multiple banks were forced to declare Reliance Naval & Engineering Limited account as non-performing asset after it failed to serve its interest obligations. Later the company reported a consolidated loss of Rs 347.1 Crore.
The company proposed a one-time settlement to its lenders on Sept 6. It offered Rs 1,000 Crore as cash repayment upfront and Rs 300 Crore as other repayments. But the lenders have given 10 days to revise its settlement proposal. If the revised settlement is accepted by 90 percent of the lenders, then the insolvency and bankruptcy petition will be withdrawn from NCLT.