India's Prakash Industries denies wrongdoing after arrests

MUMBAI Thu Aug 7, 2014 10:47am EDT

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MUMBAI Aug 7 (Reuters) - India's Prakash Industries Ltd , whose chairman has been arrested by police investigating alleged bribery, on Thursday denied any wrongdoing and said the company and its head had been wrongly dragged into the case.

The Chairman of state-run Syndicate Bank Ltd was arrested last weekend over allegations that he had sought bribes to favour defaulting debtors. Police also arrested two top executives of Prakash - a company with interests in steel, power and mining - for allegedly offering bribes.

"The company and its chairman have been wrongly embroiled in the case," Prakash said in a stock exchange filing, adding it did not have any existing credit facility with Syndicate Bank and had not defaulted on servicing any loan.

It said it had sufficient cash reserve and assets to meet its day-to-day requirements and commercial liabilities in the immediate future and that the case would have no material impact on its functioning or profitability.

Prakash Industries shares, valued at about $183 million, are down nearly 25 percent this week. The stock fell 0.8 percent on Thursday to close at 83.55 rupees in a Mumbai market that edged down 0.3 percent. (Reporting by Devidutta Tripathy; Editing by David Holmes)

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