IDBI Bank Secures $239 Million Debt Judgment In London High Court: Report

IDBI had entered into loans totalling $148 million with two Singapore registered companies -Varada Drilling One Pte Ltd and Varada Drilling Two Pte Ltd - for the construction of two jack up drilling rigs

IDBI Bank has secured a $ 239 million judgment in the commercial division of the High Court of London against a Cypriot subsidiary of India-based Essar Shipping Group, believed to be one of the largest debt judgments obtained by an Indian bank in the English courts. Mumbai-headquartered IDBI had entered into loans totalling $ 148 million with two Singapore registered companies -- Varada Drilling One Pte Ltd and Varada Drilling Two Pte Ltd -- for the construction of two jack up drilling rigs in March 2013. IDH International Drilling Holdco Ltd (IDH), the Cypriot-registered parent company of the borrowers, gave a corporate guarantee in respect of the loan. The loan and guarantee were governed by English laws and were therefore subject to the jurisdiction of the English courts. “This is an important judgment both in terms of its size and the message it sends to defaulters that Indian banks are willing and able to recover outstanding debts through the English courts,” said Nick Curling, legal director at TLT LLP, the London law firm representing IDBI. According to the law firm, in July 2017, after the borrowers failed to make scheduled repayments, IDBI served a formal demand for repayment of the principal amount, contractual interest, default interest and fees. After further non-payment, the borrowers entered liquidation in Singapore and, in January 2020, TLT commenced proceedings in the UK on behalf of IDBI.