Reliance bids for Alok Ind

Reliance Industries is interested mainly in the polyester yarn business of Alok Industries. Alok faces claims to the tune of Rs 29,519 crores from financial creditors and Rs 624 crores from operational creditors. Alok is a fully integrated textile unit with four core divisions — cotton yarn, apparel fabric, home textile and polyester yarn.

Lenders had attempted to revive the company through a strategic debt restructuring scheme. This allows them to convert part of their debt into equity and sell it to a new promoter. This got stuck following an order by the Bombay High Court that stayed the sale of assets and a change in the company's equity structure.

The court issued the order following a petition filed by HSBC on behalf of a few unsecured lenders to settle dues amounting to 55 million dollars. The account was classified as non-performing in the books of the bank by November 2016. The company posted a loss of Rs 3,502 crores on revenue of Rs 8,326 crores in the year ended March 2017.

Alok was the only company among the 12 listed by the Reserve Bank of India to be referred to bankruptcy that did not receive any bids when the insolvency professional invited expressions of interest.