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The Mobile store case reaches National Company Law Tribunal

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The Mobile store case reaches National Company Law TribunaliPhone distributor Ingram Micro and associate Bright Point India have dragged Essar Group-owned The Mobile Store to the National Company Law Tribunal (NCLT), seeking the sale of assets or liquidation of what was once the largest retailer of mobile phones in India. In their petition filed before NCLTā€™s Mumbai bench, Ingram Micro and Bright Point claimed total arrears of Rs 16.5 crore from The Mobile Store. ET has seen a copy of the petition.

This is the latest blow to the retail chain, which is winding up operations as it faces a working capital crunch with the parent making no fresh fund infusion. The India arm of US-based distribution company Ingram Micro has put outstanding amount from The Mobile Store at Rs 9.58 crore, plus Rs 2.2 crore in interest until September 30, 2017 at 24% per annum. Bright Point India has made a separate demand of Rs 3 crore, including interest. Total outstanding dues till now are estimated at nearly Rs 16.5 crore.

Petitions were filed in December and heard by the designated bankruptcy court earlier this month. The next date of hearing is February 27, said people aware of the developments.

“The Mobile Store ceased operations some time ago and they are in the process of talking to all vendors for an early resolution for matters related to supplies,” a spokesperson from the Essar Group company said. Ingram Micro India and Bright Point India did not comment on the matter until press time Friday.

According to the petitions, the retailer is undergoing a ā€œsevere financial crisisā€ and acknowledged it was in an insolvent state and unable to pay arrears. The Mobile Store has shut 400-odd stores in the past 18 months and several brands have stopped supplies to it due to outstanding payments. It is also moving to an asset-light model by focusing online, people with knowledge of the matter said. There were more than 1,000 outlets five years ago, but most are closed now.

ET reported earlier that the Essar Group was evaluating options to sell a stake in The Mobile Store to a strategic investor.



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