NCLT approves Ramkrishna Forgings Rs 129-cr resolution plan for ACIL Limited

The National Company Law Tribunal, New Delhi, has approved the Rs 129 crore resolution plan submitted by Ramkrishna Forgings Limited (successful resolution applicant) for resolution of ACIL Limited (Corporate Debtor) insolvency.  Ramkrishna Forgings resolution plan was earlier approved by the Committee of Creditors (CoC) on 05 August 2019 with 88.56% vote share.

As per the resolution plan, financial creditors would receive Rs 80.44 crore in upfront payment. The plan also provides for an additional Rs 24.5 crore worth of non-convertible debentures (NCDs) to financial creditors. Unsecured financial creditors will be paid Rs 70 lakh while operational creditors will receive a sum of Rs 36.57 lakh. The resolution plan will utilize Rs 4.19 crore towards gratuity liability of ACIL Ltd. The resolution plan has also provided for an infusion of Rs 20 crore towards capital expenditure, working capital requirements and improvement and stabilization of the corporate debtor – ACIL Ltd.

Plan for revival

Post-acquisition  of  ACIL Ltd,  the  Resolution  Applicant (Ramkrishna Forgings)  intends to focus on refurbishing the existing machinery and will strive to conduct production line balancing activities removing bottleneck and improving performance. The Resolution Applicant is further aiming to inject or arrange funds to improve its  working  capital  condition  enabling  the  Corporate Debtor to improve its working  capital  cycle  and  improve  sales.  This  will help in supplying to the existing  customers  to  maintain  their  share  of business and will strive to take necessary steps to increase the share of business with the existing client. Successful implementation of the  plan will help in retaining and providing opportunities for jobs especially in the semi-skilled and unskilled segment.

About ACIL Ltd

IDBI Bank had initiated the Corporate Insolvency Resolution Process was against ACIL Limited by an order of NCLT dated 08 August.  The adjudicating authority had appointed Ravindra Loonkar as the Interim Resolution Professional (IRP) of the Corporate Debtor and later he was confirmed as the Resolution Professional by the CoC.

Established in 1997, ACIL Limited is engaged in manufacturing of high precision engineering automotive components. The manufacturing facility of the company is located on freehold land bearing Plot No. 53 and 54, Sector-3, IMT Manesar, Gurugram, Haryana. It includes, inter alia, machines from Toyoda-Japan, Heller- Germany, Komatsu – Japan, Moriseiki.

It majorly manufactures crankshafts for tractors, HCV, LCV as well as two wheelers. Besides, the company also manufactures connecting rods, steering knuckles and hubs.The company set up its first crankshaft line in 1998 and at present it has 10 Crank shaft lines, 1 St knuckle line, 4 Hub lines and 1 Connecting rod line. Over the years, it has served automobile manufacturers like John Deere Ltd, New Holland Tractor Ltd, SML Isuzu Ltd, International Tractors Limited, Honda Motorcycles & Scooters India Limited, Maruti Suzuki India Limited, Escorts Ltd., etc.

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