With no significant bids to acquire Videocon Industries under the NCLT-led debt resolution process, lenders will examine a proposal by the company’s promoters to repay about ₹30,000 crore for taking back control of the conglomerate. Videocon Industries was controlled by the Dhoot family before lenders dragged the company to the NCLT in 2017.
“We have given a proposal to the banks under Section 12A of the Insolvency Code, that we are ready to pay full ₹30,000 crore. This means there will be no haircut to the bank,” a top company official told BusinessLine.
Videocon Industries, which is in multiple businesses ranging from oil to consumer durables, has been under the NCLT-led debt resolution process for three years. However, the lenders have not received any serious offer so far. For example, a UK-based family office has made an offer of ₹2,200 crore to acquire the company.
The banks will now have to either put the company under liquidation or accept the offer made by the Dhoot family. The offer has been made under Section 12A of the IBC, which allows withdrawal of the debt resolution proceedings under NCLT if majority of the lenders agree. Banking sources said that the offer made by the Dhoots is under consideration as liquidation may lead to poor recovery of the debt owed by the company. If the banks agree to the proposal, then it will be the first case under IBC wherein a company under resolution gets taken back by the defaulting promoters.
Company officials said that the offer made by the Dhoots is similar to the debt restructuring plan agreed by joint lending forum of banks in 2017. Videocon Industries had nearly got the banks’ approval on the restructuring plan but this was rejected by the RBI, which had by then asked banks to refer non-performing assets to the NCLT.