lnduslnd Bank announced on Thursday that it has acquired a 4.79% stake in debt-ridden bulk tea manufacturer giant McLeod Russel India through the use of pledged shares in order to recover its debt payments.
‘We pleased to inform that the bank acquired 50,00,000 equity shares of McLeod Russel India Ltd today, i.e., September 23, 2021, pursuant to invocation of a pledge of shares,’ the bank said.
The equities of McLeod Russel India retained by lchamati Investments were made a pledge with the bank to secure McLeod Russel India’s (MRIL) outstanding dues, the borrower company, lnduslnd Bank stated, adding that it exercised the pledged shares to recover its MRIL debts.
McLeod Russel, a 152-year-old BM Khaitan group company and one of the country’s largest bulk tea makers, recently emerged from the clutches of insolvency following a settlement with its financial creditor Techno Electric & Engineering. In early 2018, the company began experiencing liquidity issues, and the board of directors decided to sell some of its estates to repay the debt.
In the month of June, the Bank acquired 70, 67, 500 numbers of equity shares of McLeod, constituting 6.77% of the borrower’s paid-up equity share capital, by citing pledged shares to recover its debts.
Axis Bank, State Bank of India, HDFC Bank, Indian Bank, ICICI Bank, UCO Bank, Yes Bank, Punjab National Bank, RBL Bank, and Standard Chartered Bank are among the company’s other financial creditors. McLeod’s promoter shareholding was 10.07% at the end of the first quarter of this fiscal year.