Vedanta Group company Twin Star Technologies, the approved bidder for insolvent Videocon Industries, objected to leading banker State Bank of India (SBI) request to invite new bids on the grounds of paltry payment . He described the request as “ill-conceived, not justiciable and neither sustainable in fact nor in law”.
On behalf of the Creditors’ Committee (CdC), the SBI on September 18 urged the National Company Law Appeal Tribunal (NCLAT) to authorize new offers for Videocon in the “wider public interest” and to “s ‘ensure that public money is guaranteed in the best possible way’.
In its resolution plan, Twin Star offered to pay Rs 2,962.02 crore on admitted claims of Rs 64,838.63. This equates to a collective 95% haircut on the banks’ exposure.
In the response affidavit, filed with NCLAT on September 24, Twin Star criticized SBI for approaching NCLAT after a delay of more than three months since NCLT approved the plan, even though it had a full knowledge of the haircut when it voted in favor. He also indicated that once a resolution plan is approved by the contracting authority, the CoC becomes functus officio, in accordance with the law. Alleging that SBI “deliberately chose to conceal in its affidavit that Twin Star’s resolution plan provided for amounts greater than the liquidation value of the debtor company (Videocon)”, Twin Star said: “It is true that no Lender did not question the calculation of the âLiquidation Value.â The case is scheduled to be heard in NCLAT on September 30.