Latest News | McLeod-Carbon Extends Settlement Negotiations Till July 28

Kolkata, July 10 (PTI) Debt-laden tea maker McLeod Russel on Monday said its board has extended the agreement with Carbon Resources until July 28 to negotiate and evaluate a mutually agreeable mechanism to offer a "one-time settlement" of its debt with the lenders.

The first agreement was signed on January 21 that expired on March 31, the company said.

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With this extension, the Kolkata-based carbon products maker will be able to continue negotiations with McLeod Russel, which had faced differences over valuation.

"The board of directors of McLeod Russel at its meeting considered and approved the extension of an exclusivity agreement with Carbon Resources till July 28, to exclusively discuss, negotiate and evaluate a mutually agreeable mechanism for the company to offer a proposed one-time settlement of the debt owed by the company to its identified lenders, the company said in a stock exchange filing.

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The agreement expresses the parties' interests in continuing exclusive discussions in the matter and does not create any legally binding obligation on any party," the bulk tea producer said.

Carbon Resources had earlier made a non-binding offer to McLeod Russel's lenders to acquire a controlling stake and settle its dues.

The Kolkata-based carbon products manufacturer earlier had sent a Rs 1,245-crore non-binding offer to lenders.

Jalans-owned Carbon Resources had offered lenders to infuse upfront equity worth Rs 300 crore and a debt of Rs 945 crore to resolve Mcleod's outstanding debt. Secured lenders were supposed to be paid in full, while unsecured lenders would have to take a 45 per cent haircut.

Jalan of Carbon Resources was keen to take over the company.

The Khaitans currently own a 6.25 per cent stake in McLeod Russel and the debt stands at over Rs 1,700 crore. The lenders to the company are ICICI Bank, State Bank of India, Indian Bank, RBL Bank, Axis Bank, HDFC Bank, UCO Bank, Punjab National Bank, Yes Bank and IndusInd Bank.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)