Balmer Lawrie immune to Transafe's uncertain future

Diversified PSU Balmer Lawrie will not have any adverse financial impact as the debt-laden Transafe Services Ltd, a group firm, braces for an uncertain future, a company official said.

Transafe, a manufacturer of specialty container and provider of logistics services, will face corporate insolvency resolution process (CIRP) for a default of Rs 83 crore to the state-run Syndicate Bank, the official said.

"There will be no fresh financial impact on our books even in the worst outcome in the resolution process as we have fully provisioned the investment in Transafe," Balmer Lawrie chairman and managing director Prabal Basu told PTI.

The total debt in the books of Transafe will be around Rs 190 crore, he said.

Transafe Services is a 50:50 joint venture between Balmer Lawrie & Co and Balmer Lawrie Van Leer.

The Kolkata bench of the National Company Law Tribunal has already ordered to appoint a resolution professional to initiate CIRP process.

Failure to find an investor to revive the logistics firm has led to the crisis, he said.

"The current accumulated debt would be about Rs 190 crore. We had made several attempts in the last three year to find an investor and settle the issue with the bankers but failed," Basu said.

The company had tried for 50 per cent stake sale and even 100 per cent in the ailing firm, he said.

A package of about Rs 100 crore was required to revive the company, he said.

The company was "EBITA positive" for the last three years but it was "not enough to fulfil the debt repayment obligations".

In 1990, Transafe Services was jointly promoted by erstwhile state-owned entities like ICICI, SCICI, UTI, TDICI along with Balmer Lawrie.