Leader Universal is the promoter and 53 per cent stakeholder in the sick company which has been referred to the Board for Industrial & Financial Reconstruction (BIFR).

In a faxed message from Malaysia, Incab director & Leader Universal deputy managing director Mr Kon Td Liuk said: "An agreement between Mr SP Arya and Incab Industries was reached in Bangkok last week."

Sources in Incab said that Mr Liuk's message stated: "We will also be writing to the operating agent, State Bank of India (SBI), and the BIFR to inform them of the new development and apply for an extension of time to facilitate the preparation of a revised rehabilitation plan to enable the board to deliberate upon it."

The approval of the rehabilitation plan by BIFR and its subsequent submission to the SBI "shall take place not later than the end of this calendar year", the message added.

According to a source in Incab, the proposed extension till December 31, 2000 for submission of a revised rehabilitation plan "could only be an attempt to buy time to take the company out of the BIFR fold".

SBI recently appointed AF Ferguson to undertake a study of the assets and liabilities of Incab. The accumulated liabilities of the company stand at around Rs 165 crore.

Leader Universal had been in talks with the SP Arya group, which has interests in real estate and transportation, since early July regarding offloading its stake in Incab.

Prior to Tuesday's development, the Incab board had 13 directors - four representing the financial institutions, six representing Leader Universal and four Indian directors led by Mr P Ghosh as a wholetime director.

The percentage of Incab stake taken by the Arya group from Leader is yet to be known. Apart from Leader's 53 per cent stake in the Rs 29.76 crore Incab equity, 42 per cent is held by the financial institutions, namely ICICI, GIC, UTI and LIC, while the balance five per cent is held by the public.