NCLT approves Steel Strips Wheels Rs 138-cr bid for AMW Auto Component
The Ahmedabad Bench of the National Company Law Tribunal (NCLT) has approved the Rs 138.15 crore resolution plan submitted by Steel Strips Wheels Limited (SSWL) for corporate debtor AMW Auto Component Limited.
The plan contemplates a total resolution plan amount of Rs 138.15 crore (upfront cash) against the total admitted creditors’ claims of Rs 1,683 crore. As per the resolution plan, available cash balances in the books of the corporate debtor on the trigger date, after payment of the CIRP cost and monitoring committee cost, will accrue to financial creditors.
Up to Rs 83 crore will be contributed by the resolution applicant towards operational requirements such as refurbishment of the plant and working capital requirement of the corporate debtor, on a need basis over 6-15 months from the trigger date in the form of loans or any other form.
The plan submitted by Steel Strips Wheels Limited was approved by the Committee of Creditors (CoC) with a majority of 98.55%. Another plan submitted by the Gladiator Consortium was rejected with zero % votes.
As per the resolution plan, financial creditors will receive Rs 117 crore against their admitted claims of Rs 1,029 crore; Rs 10.54 crore has been provided for CIRP cost and Rs 5 crore has been provided for operational creditors against their admitted claims of Rs 628 crore.
The RP appointed two registered valuers — Adroit Appraisers & Research Pvt Ltd and AK Das & Associates — to value the corporate debtor’s assets. The average liquidation value of the corporate debtor was Rs 119.61 crore while the average fair value was Rs 198.37 crore.
The insolvency application against AMW Auto Component Limited was filed by Indian Overseas Bank for defaulting on a payment of Rs 12.15 crore. The application was admitted by NCLT in September 2020. AMW Auto Component is a Bhuj, Gujarat-based company engaged in manufacturing and sale of auto components.
Source of Fund
- Availing a loan facility of Rs 100 crore from Export-Import Bank of India (Exim Bank).
- Cash margin deposited for issuance of Performance Bank Guarantee (PBG) of INR 20 crore and Earnest Money Deposit (EMD) of Rs 2 crore.
- Residual resolution amount of Rs 15.30 crore will be funded out of the internal accruals of the AMW Auto Component Limited.
About the Steel Strips Wheels Limited
The successful resolution applicant — Steel Strips Wheels Limited (SSWL) — is a company listed on both Bombay and National Stock Exchange. It is involved in the manufacturing of steel and alloy wheel rims with presence in northern, eastern and southern part of India. Its registered office is situated in Mohali, Punjab. It has currently five plants in Dappar (Punjab), Chennai (Tamil Nadu), Jamshedpur (Jharkhand), Seraikela (Jharkhand) and Mehsana (Gujarat).
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