HYDERABAD : The Hyderabad Bench of National Company Law Tribunal (NCLT) Monday finally approved the resolution plan for Deccan Chronicle Holdings Ltd (DCHL), where lenders agreed to take a staggering 95.2 per cent haircut to revive the debt-ridden media entity. It may be noted that Srei Multiple Asset Investment Trust Vision India Fund, which emerged as the highest bidder for DCHL, agreed to pay Rs 408.6 crore as against the total outstanding of Rs 8,335 crore owed to over 37 banks and financial institutions. This includes Rs 8,180 crore claimed by financial creditors and Rs 154 crore due to operational creditors.
Kolkata-based Srei submitted a resolution plan in December 2018 — while two other contenders, Bennett Coleman & Company Ltd and Arm Infra & Utilities Pvt Ltd pulled out bids — which was approved by the Committee of Creditors with 81 per cent voting share, higher than the IBC’s mandate of 66 per cent. Of the Rs 408 crore offered, Rs 350 crore was provided for financial creditors and Rs 6 crore for operational creditors, as per an undertaking given by the resolution professional. However, the resolution plan ran into trouble with some creditors raising objections.
On Monday, Ratakonda Murali, Member (Judicial), NCLT, passed the order, clearing the way for Srei to take over management control, paving way for the first Indian media entity to have successfully undergone corporate insolvency.
The resolution plan is subject to reliefs on certain clauses under Section 31(1) of the Code. Srei sought waivers regarding reorganisation of share capital and exemption of payment of stamp duty on transfer of immovable properties, besides others. The order also ruled in favour of Srei, directing financial creditors to withdraw all the suits filed against DCHL.
But the relief sought on investigation by CBI or SFIO weren’t granted. The order also clears the way for Srei to use brand Deccan Chronicle, dismissing a petition claiming exclusivity by another applicant. Srei is also exempted from liability to pay tax arrears due by DCHL prior to commencement of the resolution plan, and in other instances, it has to approach authorities independently.