Alok Industries zooms 20% on buyout report

According to media reports the private equity funds along with domestic textile companies are in race to buy the company.

Alok Industries was locked in upper circuit of 20% at Rs 4.86 on the BSE on media reports that the private equity (PE) funds along with domestic textile companies are in race to buy the company.

“The banks are running the entire process of implementing the ‘Strategic Debt Restructuring’ (SDR) scheme and the company has no role to play in the said process,” Alok Industries said on a clarification of news report.

In January 2016, Alok Industries informed the stock exchange, "The company has been informed by its lead bank, State Bank of India (SBI) vide their letter dated 18 January 2016 that as decided by the joint lenders' forum (JLF) at their meetings held on November 23, 2015 and December 11, 2015, strategic debt restructuring (SDR) has been invoked on the company with the reference date being November 27."

Under the SDR norms laid down by the Reserve Bank of India, banks can convert part of their debt into majority equity in a firm which has defaulted on its payments.

Till 03:17 PM, a combined 26.35 million shares changed hands and there were pending buy orders for 2.19 million shares on the BSE and NSE.