Videocon’s resolution process may be delayed. The consortium of lenders is yet to receive any bids for the debt-laden Videocon Group’s energy business. Although before this some companies had shown their interest in it. With no bids being received, the committee of creditors headed by SBI has extended the deadline for the resolution process of Videocon Oil Ventures Limited (VOVL) and now has to complete the process by September 30. The delay in the sale of assets of Vodafone Oil Ventures will have an impact on the resolution process of its parent company Videocon. Videocon Oil Ventures extracts oil and gas through a global subsidiary firm.
No final bid despite initial interest
About three years ago, SBI Capital Markets had invited Expressions of Interest (EoI) for the sale of VOVL’s oil and gas assets on SBI’s Bihaf. Four companies, including Vedanta and Petrobras, had filed EOIs. However, none of these companies had filed the final bid. The creditors committee comprises 21 lenders, which includes 13 banks including SBI’s ICICI Bank, Bank of Baroda, Vijaya Bank, PNB and Bank of Maharashtra.
Videocon, in its initial submission to the National Company Law Tribunal (NCLT), had said that all the assets of the group should be a single tax for the sale process. However, the creditors committee had decided to sell some of the properties separately.
NCLT Order: Instructions to freeze the assets of the promoters of Videocon, questions raised on disbursement of loans to the company in 2014-2019
Order for disclosure of assets and bank accounts
Videocon Group is presently going through a corporate insolvency resolution process with Twin Star Technologies. Vedanta Group also has stake in Twin Star. Videocon Group had agreed to buy all the properties but in July 2021, the National Company Law Appellate Tribunal (NCLAT) put the deal on hold on a petition by Bank of Maharashtra. Bank of Maharashtra has a debt of Rs 1216.88 crore on Videocon Group. Bank of Maharashtra had filed a petition seeking a stay on the transaction by holding the payment by way of non-convertible debentures and equity to dissenting financial creditors as a violation of norms.
The Supreme Court later declined to set aside the NCLAT order and directed the Appellate Tribunal to deliver its final judgment on 7 September. Last week, the Mumbai Bench of the NCLT, on a plea by the Ministry of Corporate Affairs, ordered freezing of bank accounts of Videocon Group and attachment of properties. The NCLT, in its order, had ordered promoter Venugopal Dhoot to disclose information about the group’s properties and bank accounts located in the country and abroad.