Trading arm put under judicial management

Trading arm put under judicial management

SINGAPORE (AFP): The Singapore-headquartered trading arm of troubled Indian conglomerate ITC Ltd. has been placed under interim judicial management, The Straits Times reported Saturday.

Three officials from the international audit firm KPMG Peat Marwick were appointed as interim judicial managers by an order of the Singapore high court on Friday, the report said.

The officials were not immediately available for comment. ITC Global Holdings was set up here in 1992 and oversees Calcutta-based ITC Ltd.'s trading operations, with offices in Dubai, London and New York.

ITC Ltd., India's largest cigarette manufacturer with other interests including hotels, financial services, paper and packaging, is currently under investigation in India for alleged foreign exchange violations.

Some reports had said the Singapore arm had been linked in the violations involving about US$100 million.

India has strict foreign exchange rules that do not permit the free flow of hard currency out of the country.

According to the Registry of Companies and Businesses, ITC Global, a wholly-owned subsidiary of ITC Ltd., has an issued and paid-up capital of $8. 99 million.

Latest available figures show that ITC Global's net profit was $1.69 million on a turnover of $267 million for the year to December 1994, the daily said.

Indian media reports had said ITC Global suffered a loss of $16.5 million in 1995, with a loss of more than $50 million expected this year.

The ITC had said in August that it would pump $20 million into ITC Global to "revive and restructure" the company, but this plan was reportedly dropped earlier this month, fueling speculation that the creditor banks would seek to place ITC Global under judicial management.