Liquidator told to take charge of Pyramid assets

The high court here has asked its Provisional Liquidator (PL) to take charge of the assets of the Chennai-based entertainment company, Pyramid Saimira Theatre Ltd (PSTL).

This was in response to a petition by Patni Financial Services, to which PSTL owes Rs 5 crore. PSTL says it owes Rs 152 crore in loans and corporate guarantees to various lenders and Rs 378 crore of debt to foreign currency convertible bond holders.

Judge P Jyothimani’s order said, “It is now brought to the notice of the court that there is no viable (repayment) scheme in existence as on date and there is no purpose in keeping the appointment of PL in abeyance”.

PSTL's promoter, P Saminathan, confirmed the PL haf taken over the company and said: “I am not going to do anything against it.”

In June 2009, the court appointed a PL after hearing Patni Financial Services’ plea for one. However, PSTL managed to get an injunction, after Saminathan came forward and said he would repay the money, on which basis the Court kept the appointment in abeyance.

Saminathan had promised the money, both principal and interest, would be paid on or before October 31, 2009. However, it was learnt he paid only Rs 1 crore, which went towards interest. Following which, Patni on March 29 this year, petitioned the court and the liquidator was appointed.

Scheme of Arrangement proposal
Saminthan had filed a scheme to restructure and satisfy the secured and unsecured creditors and shareholders. The proposed action was, among other things, for banks to convert their loans into bonds, redeemable after three years and foreign currency convertible bonds to be converted into equity. Plus, various allied bits of restructuring.

The banks involved include Bank of India, UCO Bank, Axis Bank, Punjab National Bank, Federal Bank, State Bank of Patiala, Syndicate Bank, Bank of Rajasthan, Union Bank of India, Indus Ind Bank, Standard Chartered Bank and ICICI Bank.