Green Signal For Financial Plan

The board of directors of Shaw Wallace and Company (SWC) yesterday approved a broad financial plan for the company, which is aimed at discharging the cash-strapped company's outstanding financial liabilities expeditiously.

To fund the plan, the company is considering options which include either a rights issue or external commercial borrowings (ECBs) or both.

A merchant banker would also be appointed to advise and implement the plan. The board concluded that the company would follow a phased plan for repaying accumulated borrowings. It would be partly out of current profits, partly from the sale of certain assets and the balance from fresh infusion of funds. With strong earnings, the board is confident of paying off all outstanding borrowings by the next two to three years.

 

The board also authorised the management to submit the financial plan for the courts' consideration for granting appropriate time to repay the borrowings.

In addition, the fixed deposits of SWC which have fallen due would be paid off on a priority basis out of the monthly profits of the company. SWC is also considering certain bids received by it for the sale of consumer products division, comprising the Calcutta Chemi-cals Company, Detergents Ind-ia Ltd and bran-ds like Margo, Aramusk, Ch-ek, Tuhina etc. The audit of acc-ounts for 1995-96 is expected to be completed shortly, company sources said. The meeting took place yesterday in New Delhi. The financial plan was drafted by the Company Law Board nominee L C Gupta.

Other directors who attended the crucial meeting were CLB nominee C K Hazari, financial institutions nominee P K Pandit, Shaw Wallace and Company managing director Ravi Jain, executive directors P J Rao and T S Venkatesan and Komal Chhabria Wazir, alternate to Manohar Rajaram Chhabria.

With strong current earnings, the board is confident of paying off all outstanding debts in three years