Debt

Debt Financing

Sale of Sical Logistics under IBC takes a new turn

Business Line  

The sale of bankrupt Sical Logistics Ltd, earlier owned by the Coffee Day Group, under the Insolvency and Bankruptcy Code (IBC) has attracted 26 bidders, but the potential buyers are spooked by a lenders' decision to pull out two key subsidiaries and sell them separately. A fortnight before the bidders, including Allcargo Logistics Ltd and Pristine Logistics & Infraprojects Pvt Ltd, were asked to file a resolution plan for Sical Logistics, the resolution professional launched a separate auction process for the sale of entire equity interest of 53.6% held by Sical Logistics in Sical Infra Assets Ltd and 97.5% in Patchems Pvt Ltd. Sical Infra Assets Ltd is the holding company for Sical Multimodal and Rail Transport Ltd (SMART) that has a Category 1 licence from the Ministry of Railways, to run container trains throughout the Indian Railways network in both the export-import and domestic trade. SMART operates seven rakes and is also constructing two rail-linked terminals at Bengaluru and Chennai. Patchems is an integrated third-party logistics services firm focussed on pharmaceuticals, medical devices, life-saving products and consumer healthcare industries. The 26 eligible bidders for Sical Logistics as well as other bidders are allowed to participate in the all-cash auction process for the sale of equity in the two subsidiaries, which was approved by the committee of creditors. The move led to protests from qualified bidders for the corporate insolvency resolution process (CIRP) of Sical Logistics, with one of them filing a petition before the National Company Law Tribunal (NCLT) seeking to reverse it. In March this year, NCLT had ordered start of CIRP under the bankruptcy law against Sical Logistics. Publicly listed Sical Logistics owes Rs 1,599.50 crore to a clutch of banks and financial institutions including Bank of Baroda, YES Bank Ltd, RBL Bank Ltd, IDFC Bank Ltd, among others. Of this, the resolution professional has admitted Rs 1,574.06 crore.