Simbhaoli Sugar to face insolvency proceedings after defaulting on Rs 130 cr loan
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The Allahabad Bench of the National Company Law Tribunal (NCLT) has given go ahead to initiate corporate insolvency resolution process against Hapur, UP-based Simbhaoli Sugar. The NCLT on 12 July admitted the insolvency petition against the company filed by Oriental Bank of Commerce (now amalgamated with Punjab National Bank) for defaulting on a payment of Rs 130 crore.
The NCLT has appointed Anurag Goel as the interim resolution professional (IRP). After the NCLT order, the powers of the Board of Directors of Simbhaoli Sugar will stand suspended and such powers will be vested with the IRP.
(Check Stock price of Simbhaoli Sugar)
NCLT has declared a moratorium under section 14 of the IBC directing for the prohibition of all of the following:
a) the institution of suits or continuation of pending suits or proceedings against the corporate debtor including execution of any judgement, decree or order in any court of law, tribunal, arbitration panel or other authority;
b) transferring, encumbering, alienating or disposing off by the corporate debtor any of its assets or any legal right or beneficial interest therein;
c) any action to foreclose, recover or enforce any security interest created by the corporate debtor in respect of its property including any action under the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002;
d) The recovery of any property by an owner or lessor, where such property is occupied by or in the possession of the corporate debtor.
e) It is further directed that the supply of essential goods or services to the corporate debtor as may be specified, shall not be terminated or suspended or interrupted during the moratorium period.
About Simbhaoli Sugar
Started in 1933 as a sugar mill in Simbhaoli, UP, established by Sardar Raghbir Singh Sandhanwalia, the Simbhaoli Group is now a diversified farm-to-consumer Agri-Business and FMCG company with leading consumer brands in categories such as staples, food, beverages, home and personal care, and agri-inputs.
Over the last two decades, the Company has expanded into new categories. Starting from the staples category, the Company now manufactures and distributes a wide range of FMCG products and staples under various specialized brands spanning food products, beverages, home, personal and health care products along with agri-inputs. Its flagship brand, Trust, commands a significant share of the Indian market and in the last few decades, it has grown quickly to become one of largest trusted and reliable consumer brands in Asia.
Its domestic distribution network spans North, East, West, South and Central regions of India, with a strong presence across all channels, including General Trade, Modern Trade, HORECA and Institutions as well as selling through online channels. In addition, its strong Export presence in countries in the Middle East, Africa and South East Asia has ensured that Trust products have reached over 45 countries around the world.
In 2023-24, the company posted a revenue of Rs 1363 crore and a net loss of around Rs 12 crore. The company owes over Rs 1,300 crore to different lenders.
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