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Essar likely to exit CDR plan, may pay token recompense
After almost seven years, Essar Oil is likely to submit its proposal to exit its corporate debt restructuring mechanism, reports CNBC-TV18’s Gopika Gopakumar, quoting sources.
After almost seven years, Essar Oil is likely to submit its proposal to exit its corporate debt restructuring mechanism, reports CNBC-TV18's Gopika Gopakumar, quoting sources.
It is learnt that Essar Oil has almost agreed to pay a token as recompense to lenders in the ongoing CDR meeting. Recompense is the amount that Essar has to pay to exit CDR.
Earlier in 2004-2005, Essar Oil had opted for CDR. Under the restructuring plan, the company had agreed to a security package where 20% of the promoters' shares were pledged, besides there were partial mortgage of Essar House. Interest rate, then was around 12% or so.
The recent Supreme Court's order directing it to pay Rs Rs 6,309,crore in sales tax to Gujarat government could be one of the reasons why the company is looking for an exit at this time.
The SC had directed the company to pay up Rs 6,309,crore in sales tax to Gujarat government after it lost a case seeking benefit of a government exemption scheme.
