Viceroy Hotels: IRP invites expression of interest for resolution plan

V Rishi Kumar Hyderabad | Updated on May 15, 2018

The insolvency resolution professional (IRP) has invited an expression of interest to submit resolution plan for the hospitality chain Viceroy Hotels Ltd.

Karuchola Koteswara Rao, the IRP appointed by the National Company Law Tribunal, has informed about the move to invite resolution plan from potential applicants.

The Hyderabad-based hospitality chain was brought under the Corporate Insolvency Resolution Process by the NCLT, Hyderabad, on March 12.

While providing details of the modalities to submit the resolution plan, the IRP has set May 29 as the last date for receiving the expression of interest for the resolution plan.

The NCLT had initiated a corporate insolvency resolution process against Viceroy Hotels and appointed KK Rao as the IRP.

The matter relates to a petition initiated by Asset Reconstruction Company (India) Ltd (ARCIL) against Prabhakar Reddy, promoter of Viceroy Hotels. The hotel company had borrowed ₹321 crore from lenders, including SBI, Axis Bank, IDFC, Canara Bank among others during 2007-2011.

The loan book was acquired by ARCIL. After its efforts to recover the dues from Viceroy Hotels failed, ARCIL approached NCLT under the Insolvency and Bankruptcy Code, 2016. It claimed ₹525 crore, which includes the interest component.

While the Viceroy management contended that it was solvent and needed more time to honour its financial commitments, and that ARCIL has been showing much bigger amount than what was due, it contended that part of the dues of Viceroy Hotels was directly been paid by the Marriott Group, which manages couple of its properties.

The NCLT, while admitting the case under the insolvency proceedings, directed the professional to convene a meeting of CoC to explore if a resolution plan could be worked out. It had also provided for a moratorium that halts all proceedings against Viceroy Hotels.

Published on May 15, 2018

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