Central Bank withdraws insolvency application against Aban Offshore

Both parties say they are settling dispute; NCLT dismisses application, permits lender to approach it later

Central Bank of India one of the lender of offshore drilling contractor Aban Offshore, has withdrawn their insolvency application against the company. The National Company Law Tribunal (NCLT) has dismissed the application, giving liberty for the lender to approach it later.

The application for Corporate Insolvency Resolution Process against the company was filed by Central Bank of India, alleging that the company has defaulted around Rs 155 crore. The principal amount is around Rs 127 crore, while the rest is interest and others, said sources.

The company informed the exchange, "An application filed against the Company by one of the financial creditors under Section 7 of Insolvency & Bankruptcy Code stands withdrawn."

When the matter came up for hearing today at the NCLT, Chennai Bench, both parties said that they are settling the dispute. The company is expected to repay the debts in 5-6 months. Some of the other lender banks were also present for hearing.

Sources said that the company is working on various options to reduce the debt and has appointed a consultant to look at the options.

The company in its Annual Report for 2018-19 said that the company will be able to pay its debts as and when they fall due, as on-going discussions with lenders for re-negotiation, obtain replacement financing or through any fund raising exercise or any such proposal can be concluded.