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Banks are likely to take a call on admitting Deccan Chronicle Holdings Ltd (DCHL) into the Corporate Debt Restructuring (CDR) Cell only after the results of the forensic audit of its accounts are known.
Canara Bank is conducting the forensic audit. DCHL, which is reeling under Rs 5,000-crore debt burden, runs four newspapers — Deccan Chronicle, Asian Age, Andhra Bhoomi and Financial Chronicle — and is the promoter of IPL Team — Deccan Chargers.
A meeting of the CDR empowered group on Wednesday could not come to a decision on admitting DCHL for debt restructuring, said a banker.
This is not only because there was no supermajority — of 75 per cent of creditors by value and 60 per cent of creditors by number — at the meeting, but also because bankers wanted clarity on the forensic audit front.
DCHL had informed BSE on Tuesday that its board of directors had passed a resolution to restructure the existing debt of the company by an application to the CDR Cell.
The CDR Cell is a joint mechanism evolved by banks and financial institutions in 2001 to restructure debts of viable corporate entities affected by internal and external factors.
Under CDR, creditors, among others, make concessions by reducing the interest rate, reschedule repayments, convert debt into equity/ preference shares, waive principal/ interest (to a limited extent), and convert working capital irregularity into working capital term loan.
DCHL shares closed 9.96 per cent lower at Rs 11.03 on the BSE on Wednesday, against the previous close of Rs 12.25.
Our Hyderabad Bureau reports: The Andhra Pradesh High Court on Wednesday rejected the plea made by Tim Wright of England to stay the auction of Deccan Chargers IPL team. The auction is slated to be held on Thursday.
Justice G.V. Seethapathy did not entertain the petition filed by the Englishman through his power of attorney. Deccan Chargers promoted by Deccan Chronicle Ltd engaged the services of Tim Wright.
He had filed a case in a London court and claimed Rs 100 crore in damages and this was awarded by the court there. He filed an execution petition in the Hyderabad court for realisation of money basing the claim on the decree of London court. The case is now listed on October 3.
Tim Wright filed a petition to stay the auction of Deccan Chargers team. This application was not entertained by the trial court and asked the Englishman to explain how such a petition is maintainable when the main execution petition is pending.
The Judge said there is no error on the part of trial court and dismissed the petition in the initial stage.
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