Arshiya International has opted for a debt restructuring to tide over its acute financial crisis.
Recently the company had laid-off 290 employees and had denied running into any financial crisis.
The board of directors of the company has approved a debt restructuring proposal.
“After detailed discussions on the current financial affairs of the company, the board decided to initiate a financial restructuring process under the Corporate Debt Restructuring forum and has appointed SBI Capital Markets to advise the company,” Arshiya International said in a filing with the BSE.
“The management and board have also decided to appoint an independent professional firm to submit its report to the audit committee of the board,” it added.
The promoters of the company have decided to forego 50 per cent of their remuneration from October 1, 2012 as also the Executive Director and CFO, the company said.
Arshiya International, a free trade warehousing zone provider, has accumulated a debt of Rs.2,500 crore and is finding it difficult to repay lenders.
Recently, the promoters had pledged 18.9 million shares, which accounts for 67.9 per cent of their holdings, to raise capital.