Money & Banking

Videocon’s Venugopal Dhoot moves NCLAT; says Twin Star Technologies’ offer too low

Our Bureau Mumbai | Updated on August 02, 2021

Banks will take a ₹42,000-crore haircut after the Mumbai Bench of the NCLT approved a bid by Anil Agarwal-backed Twin Star Technologies to acquire Videocon Industries for ₹2,962 crore

Videocon group’s former promoter Venugopal Dhoot has moved the National Company Law Appellate Tribunal (NCLAT) against the decision of the lenders to accept the debt resolution proposal from a Vedanta group entity. Dhoot has claimed that the offer made by Twin Star Technologies was too low.

Banks will take a ₹42,000-crore haircut after the Mumbai Bench of the National Company Law Tribunal (NCLT) approved a bid by Anil Agarwal-backed Twin Star Technologies to acquire Videocon Industries for ₹2,962 crore. Claims worth ₹46,000 crore had been admitted under the insolvency process that began in December 2017.

NCLT expresses surprise

The NCLT, while approving the debt resolution plan, had expressed surprise that the bid placed by the Vedanta Group for acquiring 13 companies under the Videocon Group was almost the same value arrived at by the registered valuers for liquidation.

According to the valuation reports, the fair value of the Videocon group was ₹4,069.95 crore while the liquidation value was ₹2,568.13 crore. Twin Star Technologies has offered ₹2,962.02 crore to acquire Videocon

Dhoot had earlier promised to repay about ₹30,000 crore for taking back control of the conglomerate under Section 12 A of the Insolvency and Bankruptcy Code, which allows the withdrawal of the debt resolution proceedings under NCLT if the majority of the lenders agree to it.

But the offer by the Dhoot family entailed repayments until 2035, which was not acceptable to many banks on Videocon’s Committee of Creditors (CoC).

Promoters’ attempts

Dhoot’s fresh attempt to block the sale of Videocon assets comes at a time when several other promoters are also trying to do the same. For example, Kapil Wadhawan has also approached the Supreme Court claiming rights to bid for DHFL.

C Sivasankaran has also offered to take back control of Siva Industries by paying less than 7 per cent of the total outstanding debt.

Published on August 01, 2021

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