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KKR starts bankruptcy proceedings against Amtek Auto’s overseas assets

LiveMint logoLiveMint 18-07-2017 Deborshi Chaki

Mumbai: Global private equity giant KKR has launched bankruptcy proceedings against the international subsidiary of Amtek Auto Ltd, which is itself in India’s bankruptcy court, two people aware of the development said.

According to the people cited above, who spoke on condition of anonymity, the Singapore-based Amtek Global Technologies Pte. Ltd owes KKR close to $450 million in debt.

The PE firm, they said, has mandated consulting and accounting firm PwC to manage multiple filings against Amtek Global, which has 19 manufacturing plants across the US, UK, Mexico, Brazil, Germany, Italy and Hungary.

“This may be a long-drawn process as it involves filing cases in multiple jurisdictions and (under) different bankruptcy laws,” the first of the two persons cited above said.

In 2014, Amtek Global had raised €235 million from KKR towards long-term refinancing and consolidation of a part of its existing debt which stood at Rs14,000 crore at the group level at that time.

“KKR has since then acquired the entire debt of Amtek Global,” the second of the two persons cited above said.

Spokespersons for KKR and PwC declined to comment.

An email sent to Amtek Auto Ltd remained unanswered at the time of going to press.

Amtek Global’s factories manufacture high-technology products, including turbochargers, precision camshafts, valve train components, conrods and safety fasteners.

“One of the assets which is likely to be put up for sale immediately is JL French’s (Witham) Ltd, which Amtek Global acquired in 2006 for an undisclosed sum,” the second person said.

The UK-based JL French’s makes aluminium castings for auto makers, including Land Rover, Jaguar, Trellborg and Ford.

KKR decision’s to put up Amtek Global for potential liquidation follows a year-long search for a buyer for all overseas operations.

A Bloomberg report in July 2016 said the company had mandated global investment bank Rothschild to manage the sale process and was seeking bidders for its German unit, Amtek Tekfor Holding GmbH, at an estimated valuation of $1 billion.

Mint reported in March this year that Amtek founder and chairman Arvind Dham was in talks to sell some of his personal assets in the auto ancillary space to meet some of the group’s debt obligations.

Amtek Auto had defaulted on bond repayments of close to Rs800 crore in September 2015.

Since then, it has been in talks to sell various group businesses to reduce debt and had appointed Morgan Stanley to help with the plan to reduce debt which was close to Rs14,000 crore 2015.

In June, Amtek Auto was among the 12 defaulters named by the Reserve Bank of India (RBI) for immediate bankruptcy proceedings.

The other names in the list include Bhushan Steel Ltd, Bhushan Power and Steel Ltd, Essar Steel Ltd, Jaypee Infratech Ltd, Lanco Infratech Ltd, Monnet Ispat and Energy Ltd, Jyoti Structures Ltd, Electrosteel Steels Ltd, Era Infra Engineering Ltd, Alok Industries Ltd and ABG Shipyard Ltd.

Subsequently, creditors of all these companies have initiated bankruptcy proceedings in the National Company law Tribunal (NCLT) under the Insolvency and Bankruptcy Code.

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