CIL likely to convert preference shares of arm into equity

Kolkata: State-run miner Coal IndiaNSE 0.24 % Limited (CIL) plans to convert preference shares of its loss-making subsidiary Bharat Coking Coal Limited (BCCL) into equity shares to prevent it from heading to the bankruptcy tribunal because of default.

CIL had given loans of ₹2,540 crore to its subsidiary for working capital and investment requirement to keep it afloat. However, when BCCL could not repay, CIL in 2013 converted the dues into 5% cumulative, non-convertible and redeemable preference shares of face value ₹1,000 each.