Chennai, July 23, 2014 – Orchid Chemicals and Pharmaceuticals said it has completed the debt recast scheme it initiated in June last year.
The process enables the Chennai-based drug-maker to pay back dues of Rs.2,866 crore to a consortium of lenders over a period of 10 years.
The RBI panel on debt recast has also cleared the Business Transfer Agreement Orchid entered into with Hospira India in 2012, allowing the company to pay-off a portion of its total debt of Rs.3,547 crore and meet working capital requirements.
The proceeds of the sale to Hospira amount to Rs.1,134 crore. With this development, the company is back on the growth path, said Managing Director K Raghavendra Rao in a statement to the BSE.
“With our inherent strength in the cephalosporins segment, our rebuilding process will be fast and robust.”
However, the company is battling a case of mismanagement of affairs filed by Cyrus Poonawalla-backed Serum Institute of India. Poonawalla and associated firms, which hold 14.19 per cent in Orchid, had asked for an interim stay on the debt recast process, but it was not granted. The Company Law Board is expected to deliver the final verdict on July 22.
