ANZ seeks financial creditor tag in Ruchi Soya insolvency case

MUMBAI: The Australia and New Zealand Banking Group (ANZ Bank) on Monday approached the Mumbai bench of the National Company Law Tribunal (NCLT), seeking to be categorized as a financial creditor to Ruchi Soya Ltd.

The resolution professional of Ruchi Soya, which is in the bankruptcy court for defaulting on over ₹10,000 crore, has currently categorised ANZ as an operational creditor. Under the insolvency resolution process, financial creditors stand a better chance than operational creditors to recover their dues.

ANZ claims it loaned $50 million to Avanti Industries, which passed it on to Ruchi Soya for supply of goods to Avanti. Under the agreement, ANZ says, if Ruchi Soya failed to supply goods or repay Avanti, ANZ would be able to recover its dues directly from Ruchi Soya. ANZ claimed that since Ruchi Soya failed to repay Avanti, it was liable to recover the money from Ruchi Soya.

“The contract was such where Ruchi Soya had received $50 million from Avanti as working capital loan and it had to deliver the goods worth $64 million (around ₹430 crore) to it. But, Avanti Industries had a similar loan assignment agreement with ANZ Bank, from which it had borrowed that money,” Zal Andhyarujina, counsel for ANZ Bank, argued. “Avanti was merely the funnel through which the working capital loan came to Ruchi Soya.”