HDFC MF recovers entire investment in Essel group NCDs

Suresh P Iyengar Mumbai | Updated on July 03, 2020 Published on July 03, 2020

HDFC Mutual Fund has recovered the entire investment made in the non-convertible debentures issued by Essel Group companies.

The last tranche of ₹14 crore was received by the fund house on Thursday, said the fund house in a statement.

“We are pleased to inform that the schemes of HDFC Mutual Fund have recovered entire outstanding amount, including full principal and applicable interest,” it said.

With this recovery, the debt schemes of HDFC Mutual Fund have no exposure towards the NCDs issued by Essel Group companies, it added.

HDFC AMC had ₹800 crore exposure to the debt papers issued by Subhash Chandra-owned Essel Group of companies through various mutual fund schemes.

Last January, when the debt papers matured, the Group failed to repay. Some of the mutual funds, including HDFC MF, signed a ‘standstill agreement’ with the Essel Group promoter and extended the deadline for repayment till September, 2019.

After coming under SEBI glare for signing an agreement with the defaulted promoter, HDFC Asset Management Company provided a liquidity of ₹500 crore to redeem some of the fixed maturity plans which had exposure Essel Group companies debt papers.

Last August, Essel Group distributed ₹2,600 crore by selling 11 per cent stake in Zee Entertainment Enterprises to Invesco Oppenheimer. Ever since, the company has been repaying mutual funds and HDFC AMC received its last tranche on Thursday.

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Published on July 03, 2020
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