MUMBAI: Lenders have agreed to a resolution plan submitted by Mumbai-based non-banking finance company (NBFC) Finquest Financial Solutions to take over Kolkata-based SK Birla group-owned bankrupt textile company Digjam at a haircut of 40 per cent of total dues. Two lenders— UCO Bank and State Bank of India (SBI)— will receive the full amount of their admitted claims in a rare instance for banks in the new law, according to people directly involved in the negotiations.
Digjam, a well-known suiting brand of yesteryears, was dragged to the bankruptcy court by an operational creditor called Oman Inc for claims worth Rs 21.74 lakh in 2018.
The Ahmedabad bench of the National Company Law Tribunal (NCLT) admitted the petition in April 2019, following which the corporate insolvency resolution process (CIRP) was initiated.
Total dues that Digjam owed its creditors came to about Rs 168 crore.
This included bank loans, inter-corporate loans and unpaid dues to employees and suppliers. Finquest had offered to pay off Rs 100 crore of the dues including bank loans and other dues, beating an offer from another textile company, Donear Industries, one person directly involved in the negotiations said.
Source- Economic Times.