The Bombay High Court ordered Wockhardt to pay all dues to its bondholders by August 2012. The firm owes foreign bond holders Rs.417 crore, which includes interest and redemption premium. The Court also allowed the sale of its nutrition business to French foods major Danone after the cull payment of dues. The final order was passed by a division bench of justice D K Deshmukh and justice Anoop V Mohta.
Meanwhile, Wockhardt has agreed to pay Rs.315 crore by August 2012 as the rest is already deposited with the court. Under the HC-set timeline, Wockhardt, has already deposited Rs.115 crore with the court as security, will have to pay Rs.85 crore by December, Rs.30 crore by January, Rs.100 crore by March, and Rs.50 crore each in June and August 2012.
The HC asked the drug firm to give an undertaking, within two weeks, to deposit amounts as per the timeline. The amount deposited with the court will eventually go to the bondholders. It further said if the city-based drug firm misses even one payment, their appeal stands invalid.
The HC was hearing a winding-up petition filed by a group of foreign-currency convertible bond (FCCB) holders, led by Singapore-based hedge fund QVT Financial and an overseas unit of rival drugmaker Sun Pharma, after Wockhardt defaulted on redemption of US$ 110 million in October 2009.
After Wockhardt files an undertaking regarding the prescribed timeline of repayment, it will have the liberty to sell its nutrition business to Danone, the HC said. The firm recently sold its nutrition business for US$ 356 million. The court's approval is subject to the condition that Wockhardt clears its dues.