SC agrees to hear Twinstar Technologies' plea on 24 Feb
Premium- On 5 January, NCLAT ruling set aside an order passed by the Mumbai bench of NCLT approving Anil Agarwal-led Twin Star Technologies’ bid for the bankrupt Videocon Group.
The Supreme Court has agreed to hear Twinstar Technologies Ltd’s plea on 24 February, against the National Company Law Appellate Tribunal’s (NCLAT's) 5 January order.
On 5 January, NCLAT ruling set aside an order passed by the Mumbai bench of National Company Law Tribunal (NCLT) approving Anil Agarwal-led Twin Star Technologies’ bid for the bankrupt Videocon Group.
The resolution plan (which involved an acquisition at ₹3,000 crore) had been remitted back to the committee of creditors (CoC).
The Court, on 14 February, in this regard, issued a notice to the committee of creditors.
NCLAT’s decision to remit the resolution plan back to the lenders’ panel is the first such instance since the resolutions via IBC were notified in 2017. This comes amid a growing uproar over IBC resolutions happening at deep haircuts and assets being transferred at throw-away prices.
The resolution value of ₹3,000 crore against the debt of ₹61,771 crore would have led to a 94% haircut for lenders. The resolution plan was slightly above the liquidation value of ₹2,000 crore.
On 8 June, the Mumbai bench of NCLT approved the resolution plan of Twin Star Technologies. Lenders to Videocon had approved the resolution plan in December 2020.
Videocon Group owes nearly ₹61,770 crore to the financial creditors of the company, according to the company’s website.
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Of this, the largest lender State bank of India has claims of ₹11,152 crore, while IDBI Bank has claims worth ₹ 9,922 crore.
The NCLAT order follows a plea by the dissenting financial creditors – Bank of Maharashtra, SIDBI and IFCI. The three creditors made up 3% of the CoC and sought an additional ₹9 crore in the resolution plan, said a person with direct knowledge of the matter.
Videocon Industries, owned by the Dhoot family, was taken to bankruptcy court after it failed to repay ₹230 crore to SBI in 2017. However, the issue languished for a long time due to various factors.
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