Aban Offshore disclosed ₹281 crore in unredeemed preference shares, not redeemed since 2014, as it undergoes Corporate Insolvency Resolution Process. This highlights ongoing financial distress for investors.
Aban Offshore Faces ₹281 Crore Preference Share Debt Amid Insolvency
The company has disclosed outstanding Non-Convertible Redeemable Preference shares totaling ₹281 crore.
These preference shares have not been redeemed since 2014.
Reader Takeaway: Confirmation of significant unredeemed debt and ongoing insolvency proceedings are key pressure points.
What just happened
Aban Offshore Limited has filed a regulatory disclosure highlighting ₹281 crore in outstanding Non-Convertible Redeemable Preference shares that have remained unredeemed since 2014. The company is currently under the Corporate Insolvency Resolution Process (CIRP) following an NCLT order dated September 1, 2025. The outstanding preference shares, which include an unlisted portion of ₹20 crore, are currently under suspension.
Why this matters
This disclosure underscores the severe financial distress faced by Aban Offshore. The failure to redeem such a substantial amount of preference shares for an extended period indicates deep-seated liquidity and solvency issues. For investors holding these preference shares, the current suspension and the ongoing CIRP mean their recovery is subject to the resolution plan approved by the NCLT.
The backstory
Aban Offshore has been grappling with financial challenges, leading to its admission into the CIRP. The non-redemption of preference shares since 2014 points to a long-standing inability to meet these debt obligations, predating the formal insolvency proceedings. The company is now being managed by a Resolution Professional, Shailesh Desai.
What changes now
The company is operating under the direct supervision of the National Company Law Tribunal (NCLT) and its Resolution Professional. All financial decisions and debt restructuring will be governed by the CIRP framework. Investors must await the outcome of the resolution plan to understand the potential recovery or write-off of their investment.
Risks to watch
The primary risks include the uncertainty of the CIRP outcome, the potential for significant dilution or write-offs for existing stakeholders, and the long-term illiquidity of the preference shares. The company's operational viability post-CIRP also remains a key concern.
Peer comparison
Aban Offshore operates in the offshore oil drilling services sector. Companies in this sector are capital-intensive and cyclical, often facing significant debt burdens. However, Aban Offshore's situation is particularly acute due to its prolonged insolvency and unaddressed preference share obligations.
Context metrics (time-bound)
- Outstanding Preference Shares: ₹281 crore
- Unlisted Portion: ₹20 crore
- Last Redemption: 2014
- CIRP Initiation: September 1, 2025
What to track next
Investors should closely monitor NCLT filings and announcements from the Resolution Professional regarding the progress of the CIRP and the proposed resolution plan. Updates on the treatment of preference shareholders will be critical.