The board of Alpic Finance Ltd (AFL) will meet on January 5 to consider a restructuring proposal, the company informed the Bombay Stock Exchange today. The board will also look into the possibility of strategic partners in insurance and other related business and will consider the settlement of dues with banks and institutions. The company will also discuss the possibility of hiking the ceiling on foreign institutional investment in the company to 49 per cent.
The company has informed the exchange that it is concentrating on its core business of leasing and hire purchase and discontinuing broking activities.
AFL has already planned to separate the development of financial products such as leasing, hire purchase and stock-broking from the actual distribution of these services. It has decided to demerge its distribution division into a separate outfit christened Allanzers Distribution Services Ltd. As part of the plan, AFL has decided convert the bond issued by it earlier to the equity of the Allanzers. The plan, however, hit a roadblock as Bank of Baroda (BoB) - trustee of the bond issue -- objected it. BoB's decision followed the ignorance expressed by a section of bond-holders about the extraordinary general meeting of the company held on May 15 that cleared the demerger proposal.
The company is also looking for one-time settlement of bank loans which it has defaulted. The company, however, stopped taking public deposit since 1996-97.
AFL, engaged largely in medical equipment financing and truck financing, had earlier planned to merge with three other non-banking finance companies -- Apple Finance, Apple Credit and Srei International -- to have an edge in the industry. The merger plans, however, fell through as it failed to meet due diligence.
