Nicco stock: 2017 debt-resolution plan faced lender demands

Nicco Corporation's debt-resolution process faced demands for changes from lenders, according to a report by The Economic Times last updated on July 6, 2017. The report said the committee of creditors had asked the promoters to rework the resolution plan and agreed to seek an extension of the process.

Lenders sought a revised plan

The report said Nicco had entered insolvency proceedings before the National Company Law Tribunal in January 2017. The committee of creditors had admitted fund-based claims of 278 crore rupees, with State Bank of India, Allahabad Bank and Canara Bank among the major lenders.

Nicco had proposed selling non-core assets and seeking fresh working-capital support to restart operations. The company was described as a former specialised cable maker whose plants in Shyamnagar and Baripada had suspended work in April 2015 because of financial constraints.

Investor context remains restructuring risk

The account places creditor consent and the viability of any revised plan at the centre of the investment case. It also highlights the risk that an unresolved process could end in liquidation rather than a return to normal operations.

For investors, the central question in the reported situation was whether creditors would accept a revised restructuring plan and whether asset sales could provide a path to renewed operations.