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NCLT Extends Videocon's Insolvency Resolution Process

NCLT Extends Videocon - "This is for the extension of the CIRP process as it ends on 4th of February. Public notices are being given for the submission of bids on 31st of Jan and we see a lot of it coming in, so we request the CIRP process be extended further," said the counsel representing Videocon Industries. Videocon Group had sought expression of interests (EoIs) for its 13 group companies undergoing resolution in the Indian bankruptcy court in October and it was to come to an end by January 2020. Section 12 of bankruptcy code states that the completion of a CIRP process must be within 180 days, extensible to a maximum of 270 days from the date of commencement of insolvency. Thus, the new extension will come to an end on 4th of May, 2020. "There are many applications pending, like the application to merge the overseas oil and gas assets with VIL assets. Oil and gas assets are ostensibly held through a special purpose vehicle by Videocon" said a lawyer representing VIL. There is a total claim of around Rs 57,000 crores pending from the group and the merged 13 companies had just Rs 29,000 crores of claims. It is better to bring the overseas assets too into the process, he said, adding that the extended date will help in figuring it. Prior to the consolidation, claims of financial creditors of Videocon Industries stood at ?59,451.87 crore, as on 12 November, 2018. State Bank ofNSE 0.99 % India’s claims were at ?11,175 crores. Claims of financial creditors of Videocon Telecommunication Ltd, another group entity, was at ?26,673.81 crore. NCLT in the month of August, 2019 passed a judgement to initiate insolvency proceedings for consolidation of 13 Videocon group firms into a single process. And in the month of October the Group's consortium of lenders led by SBI went ahead to sell the group's overseas oilfield assets, Videocon Energy Brazil and Videocon Indonesia Nunukan. The VIL in the tribunal argued that it's better to include those assets in the on-going CIRP. In response, NCLT had passed an order barring SBI to sell the overseas assets as "the Videocon group may suffer irreplaceable loss if it was determined later that the assets belong to the Venugopal Dhoot-led entities," the court said. Source: https://economictimes.indiatimes.com

 

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