NCLT reserves order against ABG Shipyard

INSOLVENCY PROCEEDINGS

The Ahmedabad bench of the National Company Law Tribunal (NCLT) has reserved its order on insolvency proceedings initiated by ICICI Bank against debt-ridden ABG Shipyard.

On Thursday, the bench asked the parties to file more details as another petition for insolvency against ABG Shipyard had been filed by 20 unsecured creditors at the Gujarat High Court. The NCLT bench said it would announce the date of pronouncement later this week. ICICI Bank had filed its petition against ABG Shipyard under the Insolvency and Bankruptcy Code (IBC) before the NCLT’s Ahmedabad bench chaired by Justice Bikki Raveendra Babu.

Part of the 12 large defaulters identified by the RBI, ABG Shipyard owes an outstanding debt of over ~10,000 crore. The RBI had identified 12 companies as large defaulters based on the criteria of at least ~5,000 crore worth of debt exposure, of which 60 per cent has been termed bad by lenders. Companies such as Jyoti Structures and Alok Industries, among others, who are part of the 12 large defaulters, have already seen insolvency proceedings being initiated against them with the NCLT benches admitting lenders’ applications.

Apparently, ABG Shipyard’s counsel had earlier stated that the company had not opposed the insolvency petition filed against in the Gujarat HC.

In a BSE filing earlier this month, ABG Shipyard had admitted to a “deep financial crisis”. As against a net loss of ~1,266.22 crore in the quarter ended December 31, 2015, ABG Shipyard had reported a net loss of ~822 crore for the corresponding quarter in FY17.