India

Even as the Committee of Creditor (CoC) is likely to decide within a week on Videocon Industries promoter Venugopal Dhoot's offer of Rs 31,289 crore for withdrawal of insolvency proceedings against 15 of his group companies, the question that will remain in creditors' mind is how he would fund this offer, Business Today reported. In an interaction with Business Today, Venugopal Dhoot says that they plan to raise the money from monetisation of assets, affordable housing, consumer electronics and home appliances business.

Bankrupt carrier Jet Airways India Ltd., once the nation’s biggest airline by market value, is planning to restart operations as a full-service carrier by the summer of 2021, its new owners announced, Bloomberg News reported. A consortium led by Dubai-based entrepreneur Murari Lal Jalan and Kalrock Capital has set a revival plan for Jet Airways, which includes a dedicated freighter service and hubs in small Indian cities beyond Delhi, Mumbai, and Bengaluru.

The Reserve Bank of India will undertake closer scrutiny and auditing of shadow lenders and large urban co-operative banks in a bid to improve supervision of the financial sector, Bloomberg News reported. The central bank will implement risk-based audits at shadow lenders and urban co-operative banks that focus on localized lending, Governor Shaktikanta Das said Friday. It will also harmonize guidelines relating to the appointment of auditors across all types of lenders.

International investors have cried foul over the sale of an insolvent finance company in India due to concerns surrounding the auction process, casting doubt on the effectiveness of the country’s overhauled bankruptcy code, the Finanical Times reported. The controversy stems from the auction of shadow lender Dewan Housing Finance Limited (DHFL), a company with about $14bn of debt that was taken over last year by India’s central bank, in a process widely viewed as a test of new bankruptcy rules brought in four years ago.

India’s economy contracted 7.5 per cent year-on-year in the quarter ending September, taking it into a technical recession as strict lockdown measures to deal with the coronavirus pandemic continued to weigh on output, the Financial Times reported. The performance was better than many analysts had forecast but still reflected the heavy blow the pandemic has delivered to what was recently the world’s fastest-growing large economy.

Zambia’s state mining arm ZCCM-IH plans to appeal a court ruling in favour of Vedanta , which has sought arbitration in a dispute over its jointly owned copper mine that is facing liquidation, the mining minister said. India-based Vedanta has been locked in a protracted dispute with the Zambian government since May 2019, when Lusaka appointed a liquidator for the mine. “ZCCM-IH has already indicated that they are appealing because they are not happy with the court judgment,” Mining Minister Richard Musukwa told parliament on Thursday. Last week, a Zambian court ordered a halt

India’s stressed asset deals are starting to look cosy. Local tycoon Gautam Adani’s roads-to-mining empire narrowly outbid U.S.-based Oaktree with a $4 billion bid for a collapsed housing lender, but it was submitted after a deadline passed and cheekily expanded on its original plan, Reuters reported. It’s the second time in just a few months that the industrialist has blindsided foreign buyers. The higher offer from Adani Enterprises might be welcomed by creditors led by State Bank of India.

In a move aimed at speeding up the liquidation process, the Insolvency and Bankruptcy Board of India amended its regulations to allow a corporate debtor’s asset that is “not readily realisable” to be transferred to a third party in consultation with stakeholders, The Economic Times reported. Creditors can also transfer debt due to them to a third party during the liquidation process to benefit creditors who may not be willing to wait for completion of the process.

It has almost been a year since troubled Dewan Housing Finance Corp. Ltd (DHFL) was thrust into insolvency proceedings—the first financial firm to be under the code, Mint reported. The committee of creditors has held 11 meetings so far and a 12th was on at the time of writing this piece. The latest meeting comes in the wake of a surprise bid for DHFL. An Adani Group company now wants to buy DHFL lock, stock and barrel for an amount higher than the highest bid of ₹31,000 crore made by Oaktree Capital so far, according to a Mint report.

Banks have been able to convince corporate borrowers to avoid applying for debt restructuring given that the “negative externalities" and aggregate debt recast are not expected to breach the ₹1-trillion mark, a State Bank of India report said on Wednesday, Mint reported. “In terms of numbers, assuming 15%-20% of the corporates had opted for moratorium, based on our earlier analysis, the restructuring amount originally envisaged was up to ₹7 trillion," Soumya Kanti Ghosh, group chief economic adviser, SBI said in the SBI Ecowrap report.