 "Lender's to Alok Industries hunt O&M agency")
Faced with hurdles to find a suitable buyer for ailing textile firm Alok Industries Ltd, its lenders are now looking to engage Operations and Management (O&M) agency to look after affairs of the company.
Banks had invoked rules for strategic debt restructuring (SDR) for textile firm in November last year as an attempt to find get new investor for company.
On January 18, 2016, its lead lender State Bank of India (SBI) had told company that SDR was invoked company with the reference date being November 27. Reserve Bank of India has laid down rules for SDR. Banks can convert part of their debt into majority equity in a firm which has defaulted on its payments.
A top senior bank executive said "till we find the buyer, we have to protect value of enterprises to avoid adverse impact on us later. O&M agency would oversee operations and also keep a tab".
Banks have also ordered forensic audit of the books of Alok Industries. Generally about two months time is provided for audit but it could extend based on the issues come to fore.
Chief executive of South-based bank said appointing O&M is part and parcel of options before lenders and lead lender (SBI) is negotiating with some of prospective agencies for it.
The total debt of Alok Industries at consolidated level is over Rs 20,000 crore.
