The Hindu Business Line : Nambiars to plough settlement money for BPL debt recast

MR T.P.G. Nambiar, the patriarch of the BPL Group, will plough back the cash unlocked through an out-of-court settlement with his son-in-law, Mr Rajeev Chandrasekhar, as promoters' money to get the group's flagship company BPL Ltd's much-delayed Corporate Debt Restructuring (CDR) package off the ground.

The CDR involving the consumer durable company's Rs 1,400-crore debt is awaiting ratification by the Kerala High Court.

Mr Ajit Nambiar, Chairman & Managing Director of BPL Ltd, told Business Line that the money from the settlement, which was made public last weekend, would form the corpus for the promoters' expected $20 million (Rs 92 crore) contribution to the CDR package.

The settlement cash - depending on the exact quantum - would be either used entirely or mostly as the required promoter liquidity for the CDR, Mr Nambiar stated, while adding that he was not yet ready to talk about what would be the final transaction between his father and Mr Chandrasekhar.

Earlier, the younger Nambiar had said that the promoters would raise $20 million as their liquidity for the CDR from undisclosed European financial institutions.

Mr T.P.G. Nambiar and Mr Chandrasekhar, Chairman of the BPL Mobile Group, reached an out-of-court settlement whereby the former has decided to exit the latter's mobile business by selling his seven per cent stake.

Late last year, the senior Nambiar had dragged his son-in-law before the Company Law Board alleging that the latter acted in ways that led to the dilution of his stake in the cellular company, which the BPL Group had helped to establish in the mid 90s.

However, the financial details of the transaction were not bared to the media and it is also not clear whether the transaction was completed or is still pending.

While the settlement emphatically signals Mr Chandrasekhar's formal parting of business relations with the BPL family, it is not certain whether the truce has brought about an emotional patch up between him and his septuagenarian father-in-law.

But it is also clear that the severing of business ties between the two would not impact the role of Ms Anju Chandrasekhar, daughter of Mr T.P.G. Nambiar, in the affairs of BPL Ltd. She has been on the board of the flagship company for nearly a decade and plays a critical role in supporting her brother in running the consumer durables business.

Meanwhile, BPL Ltd's CDR has managed the support of 94 per cent of the creditors by value, Mr Ajit Nambiar said.

It is learnt that UTI and Bank of Rajasthan are the only two financial institutions in the list of 28 creditors, who have not yet expressed their support to the company's long drawn CDR.

In fact, BPL's one year-old equal joint venture with its Japanese partner, Sanyo, for the group's mainstay colour television business, is awaiting the court ratification for the CDR to commence operations.

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