Singapore court asks Mercator arm to reach agreement with creditors during adjournment period

Court hearing adjourned on 20 November till no later than 8 January 2016

Mercator Lines Singapore, a step-down subsidiary of Mercator Limited, which is undergoing court hearing on the appointment of a judicial manager, and possible scheme of arrangement being proposed by Mercator Lines were adjourned on 20 November till no later than 8 January 2016, the company said in an exchange notification today.

The court hearing is in connection to one of Mercator's creditors who had given notice to the company saying that it has taken steps to enforce security on the vessel Chitra Prem through banking facilities the bank has provided to Chitra Prem Pte Ltd. Another creditor to the Singapore subsidiary is seeking to have a court appointed judicial manager to run the company.

"The adjournment was allowed for the Singapore subsidiary and its creditors to try to reach an agreement on a consensual refinancing, recapitalisation and restructuring plan," said the notification.

Mercator, which holds 66.17 percent stake in its subsidiary Mercator Lines Singapore, has been churning profits since last two years on a standalone basis-the company's pure shipping business. Shares of the company were trading at Rs 28 today, up 2 percent from previous close.