July 06, 2022 (MLN): Agritech Limited (AGL) has informed that the Honorable High Court of Lahore has approved the “Scheme of Arrangement" between the company and its creditors for the rehabilitation of the company filed under sections 284-288 of the Companies Ordinance 1984, which shall take effect from January 31, 2013.
During the past few years, gas curtailment to the company's urea plant years was the major cause of non-servicing of the debt of the company and the accumulation of mark-ups further increased its debt burden, the transmission report of the company revealed.
In addition to this, few banks and financial institutions had filed cases for recovery of loans extended by them along with accrued markup and other related charges against the company.
In order to streamline this debt burden, a capital restructuring plan was envisaged with the cooperation of lenders to devise a sustainable capital structure, which included the conversion of its existing land to pay off long-term lenders after seeking the necessary approvals, it added.
This capital rehabilitation plan was filed through a petition in Lahore High Court in June 2016 for the enforceability of the scheme under section 284-288 of the Companies Ordinance, 1984.
Since the company has obtained the approval of LHC, it seems to be more confident to implement the plan for improving its financial position.
Currently, the stock of the company is trading at Rs7.09 [1:10 PST], up by 49 paisa or 7.42% DoD.
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