Vedanta’s offer of a little over Rs 3,000 crore(US$41.12billion) for 13 companies belonging to the Videocon Group was far below the expectations of lenders, however, slightly above the liquidation value.
The dedicated bankruptcy court on Tuesday has approved the Vedanta Group’s subsidiary Twin Star Technologies Ltd’s resolution plan for Videocon Group. This is the first consolidated group resolution since the inception of the Insolvency & Bankruptcy Code (IBC).
Vedanta’s offer of a little over Rs 3,000 crore for 13 companies belonging to the Videocon Group was far below the expectations of lenders, however, slightly above the liquidation value.
“The resolution plan is approved, subject to the payment to the dissenting financial creditors should be paid on priority basis as per the laws,” said the Mumbai bench of the National Company Law Tribunal (NCLT) in an oral order. “The lenders should also consider the payment of the salaries to its employees.”
The Videocon Group was undergoing consolidated corporate insolvency, where its flagship company Videocon Industries’ admitted claims stand at over Rs 61,770 crore to its financial creditors. The Videocon Group is part of the Reserve Bank of India’s so-called second list of 26 cases for mandatory resolution.
Earlier on November 11, 2020, the lenders of the group had approved the resolution plan submitted by Twin Star Technologies Ltd with over 95 per cent voting in favour and subsequently submitted at NCLT for its approval.
The Corporate Insolvency Resolution Process (CIRP) of Videocon Group was closely observed by many since this was the first instance of common insolvency proceeding of all inter-connected group entities. The tribunal had allowed the lenders application in August 2019 for consolidation of insolvency proceedings of 13 Videocon Group companies into a single process.
When contacted, the Resolution Professional (RP) for the Videocon Group, Abhijit Guhathakurta confirmed the development and said that being the first resolution process on a group level, this will certainly set the precedent for future group level insolvencies. While an email to Vedanta Group remained unanswered.
Videocon ex-promoter Venugopal Dhoot granted bail in ICICI Bank-Chanda Kochhar case
The bail application was moved by Dhoot’s lawyer Sandeep Ladda at the court of additional sessions judge AA Nandgaonkar seeking relief from arrest for the 70 year old Dhoot on grounds of his age and ill health during the course of the trial.
Venugopal Dhoot promoted Videocon Industries holds a 25 per cent stake in the Ravva oil field, in which Vedanta, through Cairn India, holds 22.5 per cent shareholding. The acquisition may help Vedanta pick up an additional stake in the oil field.
