NCLAT attacked Twin Star Technologies’ Videocon takeover led by Anil Agarwal
New Delhi:
A bankruptcy appeals court has ruled out billionaire Anil Agarwal’s win led by Twin Star Technologies to take over Videocon Industries Limited following calls by some creditors that the money being offered imposed a haircut. up to Rs 62,000 for banks.
The National Company Law Appeals Court (NCLAT) has ordered creditors to initiate the sale of new Videocon, a longtime consumer goods company that makes products ranging from air conditioners to washing machines, to recall 64,637 Their unpaid Rs 0.6.
While the majority of lenders had previously accepted Twin Star Technologies’ offer of Rs 2,962.02, Maharashtra Bank (BoM) and IFCI Limited objected, arguing that the amount offered was close to the payment value. bankruptcy of the company and that they cannot be paid less than the liquidation value.
Following the approval of Videocon’s Committee of Creditors, the Mumbai panel of the National Company Law Court (bankruptcy court) last June agreed to Twin Star Technologies’ (referred to as) a takeover offer. is the Bankruptcy Settlement Plan).
That order was challenged by the Board of Directors and the IFCI before the NCLAT, which on Wednesday dropped the NCLT order saying provisions of the Bankruptcy and Bankruptcy Code (IBC) had not been complied with.
A two-member panel of Jarat Kumar Jain and Ashok Kumar Mishra said approval of the takeover plan was “inconsistent with Section 31 of the Code” and reserved “approval of the Commission’s Settlement Plan”. creditors (CoC) as well as the Rating Agency (NCLT)”.
It referred the matter back to the CoC to complete the process in accordance with the provisions of the Code.
This essentially means that the CoC will now seek new bids for Videocon, unless the NCLAT order is challenged in a higher court and dismissed.
“We are aware of the order and it will further delay Videocon’s settlement,” Twin Star supporter Gopal Jain said on behalf of the company, commenting on the order. “We are awaiting written orders and will then take appropriate action.” The Board of Directors, which has 1.97% voting rights in CoC and IFCI Ltd with 1.03% voting shares, also objected to the main part of Agarwal company’s payment made through debentures. convert instead of cash.
Twin Star must pay Rs 500 crore within 90 days and the rest as non-convertible debts for a period of time. Videocon’s shares were delisted as part of the plan.
Videocon was among the first 12 companies to be pushed into bankruptcy following a 2017 directive by the Reserve Bank of India (RBI) to auction companies that have not paid fees.
The NCLAT order said creditors had claimed a total of Rs 72,078.5 crore on Videocon, of which a claim of Rs 64,637.6 was verified and accepted for bankruptcy purposes.
“It is claimed that the plan offers a meager amount of Rs 2962.02 against the liability admitting about Rs 65,000, the haircut rate is more than 95%.
“Even the claims of financial creditors were settled below 5% while the OC (Operating Creditor) was hardly 0.72%,” it said.
