AION, SSG Capital keen to invest in Amtek Auto
Automobile component maker Amtek Auto, which is among the companies to have been referred to the National Company Law Tribunal (NCLT), has seen interest from a clutch of private equity players. AION and SSG Capital are among the private equity firms which have submitted expression of interest to buy Amtek Auto, sources close to the development said.
It is learnt that AION has also submitted expression of interest for two other companies in the NCLT including Essar Steel and Monett Ispat.
SSG Capital did not respond to an e-mail query, while AION did not wish to comment on the matter.
Meanwhile, an official associated with Amtek Auto's insolvency proceedings said the committee of creditors has approved the company’s proposal to get interim finance. When the resolution professional had asked for interim finance the first time, the committee of creditors had declined.
Amtek Auto is a classic example where cross-border insolvency comes into play. Amtek’s Singapore entity and some of its units in Europe have been taken over by a resolution professional from PwC. The team of resolution professionals for Amtek Auto in India is getting into informal agreements with the professional looking after the Singapore and Europe entities to obtain information useful to the committee of creditors in India, said a source. In this case, there is no formal agreement as India does not have a cross-border insolvency law yet.
Private equity giant KKR had filed insolvency proceedings against Amtek Global Technologies, the international subsidiary of Amtek Auto. Amtek Global Technologies owed KKR $450 million. Amtek Global’s factories manufacture high-technology products, including turbochargers, precision camshafts, valve train components, conrods and safety fasteners.
The company's financial stress is seen as a consequence of a string of acquisitions abroad. The problems began showing in 2015, when CARE Ratings suspended Amtek’s bond ratings and JP Morgan froze redemptions. The company reported standalone losses of ~889.6 crore for the quarter ended June 2017, more than double the loss in the same period a year before. Total income from operations during the quarter was ~447 crore, down 13.4 per cent from one year ago.