Loan Amount Of Rs 200 Crore Prepaid By Promoters Of JK Tyre And Industries
Published On 13-Sep-2019 03:47:23
Loan amount of Rs 200 taken by JK Tyre and Industries, which was taken just five months ago was prepaid by the promoters of the leading tyre manufacturer. This was done with the intention to revive the confidence of the investor and also to recover the control of the promoter’s promised shares. Bengal & Assam Company is the holding corporation of the JK Tyre Group, and it is employed in stock trading for the organisation. Moreover, it has borrowed approximately Rs 200 crore from KKR Capital in the month of March. Also, the loan was provided as collateral against the shares of JK Tyre & Industries, which is owned by the Singhanias, the group promoters.
A superior official familiar with the subject stated “It was a four-year collateralised loan. With tumbling share prices of Bengal & Assam, the lender sought additional shares. But the company prepaid the whole loan in two tranches.” JK Group said that the firm had prepaid the loan in two portions of Rs 50 crore and Rs 150 crore in the past two weeks. In addition to that, the latest payment was made on August 30, and the registered repayment deadline was March 2023.
The tyre maker added “All JK Tyre shares pledged against the loan have been returned to the promoters following the repayment. The decision to repay the loan and get back the shares was taken keeping in mind the interest of shareholders and to instil confidence in investors associated with JK Tyre, despite the odds in the market.” Nineteen per cent shares were recorded in August which has put a reflection on the slowdown in India’s auto industry this millennium.