HEADLINES
JOBS
COM:PORT
POLICY POLICE
ARCHIVES

A consortium of banks and financial institutions led by the Industrial Development Bank of India has recommended infusion of Rs 1.24 billion into the liquidity hungry Pertech Computers Limited.

Following this decision, PCL has proposed a 'scheme of compromises' for its creditors, including those who had booked computers under its much publicised 'Millennium Scheme', for repaying their dues in a phased manner.

The company has proposed a series of separate meeting with its creditors in the last week of July to appraise them of the latest developments.

T O D A Y

• Lazarus II • Nokia plant on hold • NIIT profits up 92% • Apple pie in India

PCL requires investment of Rs 1.4856 billion to recover. An amount of Rs 1.24 billion has been approved by the IDBI led consortium and the balance Rs 245.6 million is sought to be financed from internal accruals.

PCL requires Rs 1 billion for its manufacturing arm, Altos India Limited and Rs 70 million for its hardware exports division.

Banks and financial institutions have finally broken their silence on the issue of infusion of fresh funds into PCL.

PCL's earlier request of disbursing the enhancement sanctioned limit of Rs 320 million had failed to impress the banks and financial institutions. PCL owes a sum of Rs 841.5 million to banks and financial institutions.

PCL had asked Arthur Andersen to carry out a valuation exercise for its hardware exports division. Arthur Andersen pegged the value of the division at between $23 million and $26 million.

Based on the evaluation, IDBI prepared a project report supporting PCL's revival.

At a recent meeting of the bankers' consortium, the financial institution took the lead in supporting the company to overcome its cash crunch, PCL sources said.

IDBI has projected PCL's profit before tax at Rs 645.3 million for the current fiscal. The last time PCL posted a profit before tax was in 1996, when it notched up a figure of Rs 129.1 million.

IDBI feels the company is "competent to recover from the temporary financial crunch" and sees profitability in the near future.

PCL claims the 1996 setback was 'temporary in nature'. "The company is hopeful of surmounting the crisis," it said. On the reasons behind the crisis, PCL said its business suffered because of 'choked cash inflows'.

Earlier:

• The Great Gamble
  How Pertech, India's largest PC maker, tripped in the fast lane.

- Compiled from the Indian media

Tell us what you think of this story