The debt restructuring proposals of two of the listed companies of Williamson Magor Group are at an advanced stage with their bankers, the shareholders of Eveready Industries Ltd (EIL) were told on Tuesday.

Speaking at the annual general meeting of EIL, chairman and promoter Aditya Khaitan said despite the pandemic delaying the process, “investors’ interest continues and possible opportunities for investment and restructuring are being examined and explored as we speak”.

EIL itself is not being restructured: the storage cell battery maker has reduced its debt by the sale of land and generation of more cash from a higher operating margin. But the company will immensely benefit from a group-level restructuring as the funds it lent to the group entities would come back.

The Khaitans have been in a dialogue with the banks to restructure the debts of bulk tea producer McLeod Russel India Ltd and McNally Bharat Engineering Co Ltd. “The group has assets of sizeable and marketable value, monetisation of which could not be crystallised due to the Covid disruptions and the lack of liquidity in the market.

“I reassure that steps have been initiated to resolve the issue but due to the unforeseen circumstances related to Covid there has been a delay,” Khaitan informed the handful of shareholders who could participate in the virtual AGM.

Eveready had given inter-corporate deposits and corporate guarantees to group entities and holding companies. Principal and interest on some of those ICDs have fallen due. With resolutions coming into effect at the operating company, their cash flows are expected to increase. When these operating companies pay back to the holding company, it will in turn be able to repay the dues to Eveready.

The board has written to all entities to which it had lent asking for a repayment plan. Such a letter has been issued on September 24 and replies are expected in two weeks .

Expansion plan

Amritanshu Khaitan, managing director of EIL, said the company would expand capacity of AAA batteries by 50 per cent by adding a new line to the Tamilnadu plant. “There is strong demand for batteries and flashlights. Our factories are running full out,” he informed.