The Dhoot family has offered to pay Rs 30,000 crore to the lenders to get 13 Videocon Group companies out of the insolvency process. Venugopal Dhoot, chairman and managing director of the suspended board of Videocon Industries, said the proposal to repay the outstanding loans of lenders has been sent to the Committee of Lenders (COC).
The company's board was suspended after the Corporate Insolvency Resolution Procedure (CIRP) was initiated under the Insolvency and Bankruptcy Disability Code (IBC). The Dhoot family, the former promoter of the group, is hopeful that a final decision on the solution offering will come by the end of this year.
For this, the consent of the lender and the National Company Law Tribunal (NCLT) is required. Videocon Group has a total of 15 companies under CIRP. 13 of these companies have been offered this solution. The two group companies KAIL and Trend are not included in the offering.
The Mumbai bench of NCLT had merged 15 companies of the group together to speed up the resolution process and ensure better pricing. Dhoot said I hope the final decision on this will come in the next 30 to 60 days.
The bankruptcy process can stop like this
Under section 12A of the IBC, the tribunal may allow the withdrawal of insolvency proceedings against a company with certain conditions. The related solution professional must proceed with a motion to withdraw the insolvency process. 90 members of the COC franchise require approval on the proposal.
Dhoot said that the latest proposal under Section 12A is similar to the one made in October 2017. The proposal was approved by the Joint Lending Forum and sent to the Reserve Bank of India.
He said, under the original proposal of October 2017, the loan which was to be considered for restructuring was Rs 31,289 crore. In this, the borrowers will not have to leave anything in the total outstanding debt. At the time this proposal was rejected. The bank then went to the tribunal to initiate the CIRP process.