Delisting of cos: Sebi proposes to allow promoters to make counter offer
Markets regulator Sebi today proposed measures to provide promoters a say in the price offered to shareholders of companies that are planning to delist from stock exchanges. The proposal is aimed at plugging loopholes in the current delisting method for companies. Issuing a draft paper, Sebi has suggested for a price discovery as per reverse book building (RRB) method, along with considering counter offer of promoter. Currently, if the price discovered through reverse book building is not attractive to the promoter, he may unilaterally reject the price and the whole exercise becomes futile. The regulator has proposed that the promoter may be allowed to make counter offer to the shareholders of that class.
GST Council approves setting up of appellate tribunal
A Goods and Services Tax Appellate Tribunal (GSTAT) will come into effect soon, providing a higher judicial forum for businesses to redress disputes under the new tax framework. The GST Council approved creation of the tribunal with a national bench in Delhi and three regional benches in Chennai, Kolkata and Mumbai, said a senior government official privy to the deliberations of the council. The GST law provides for an appeal and review mechanism for dispute resolution under the framework, which was rolled out on July 1 last year. The tribunal is the second level of appeal where pleas can be filed against orders from appellate or revisional authorities.
NCLAT reserves order over Bhushan Steel, challenging sale to Tata Steel
The National Company Law Appellate Tribunal today reserved its order over plea filed by former promoter of Bhushan Steel challenging the sale of the debt-ridden company to Tata Steel under the Corporate Insolvency Resolution Process. The appellate Tribunal has also reserved order over pleas of engineering firm Larsen & Toubro Ltd, an operational creditor of Bhushan Steel, which has supplied goods worth Rs 9 billion to the company. A two-member bench headed by Chairman Justice S J Mukhopadhaya has said that the parties, which also include Bhushan Energy, may file their written submissions by tomorrow. In May, the Principal bench of the National Company Law Tribunal (NCLT) had approved Tata’s Rs 325 billion deals along with 12.27 per cent equity to the lenders.
RBI moves to wind up CDR system
The Reserve Bank of India (RBI) is moving to shut down the corporate debt restructuring (CDR) system, it’s very first loan recast mechanism, following its latest framework on stressed asset resolution, three people familiar with the matter said. The regulator has directed the CDR cell to transfer all pending cases to respective lead banks to complete the resolution process, the people cited above said on condition of anonymity. According to the latest available data, the CDR cell has approved restructuring of stressed loans worth 4 trillion since its inception in 2001. Of this, 84,677 crore worth of loans exited the CDR cell successfully and 1.84 trillion exited without success. Nearly 1.32 trillion worth of bad loans are presently undergoing restructuring in the cell.
RBI Circular: Government to favour relief to power producers at Allahabad High Court
The government will root for some relief to stressed power projects from the central bank’s February 12 circular, which stipulates time-bound resolution of bad assets, when the Allahabad High Court next hears a case filed by the power players on August 2. The Centre could suggest an extension of the reference date fixed by the Reserve Bank of India (RBI) for starting the resolution of the first set of stressed asset cases by 6-12 months from March 1, 2018, banking sources told FE. While the government could once again argue in favour of giving banks one year instead of six months from the date of default by an entity to invoke insolvency proceedings against it, given the RBI’s opposition to any such relaxation earlier, it could ask for the extension of the reference date in that case, said the sources.
Final approval for Vodafone-Idea merger
The Department of Telecommunications (DoT) on Thursday cleared the much-awaited $23-billion merger of Vodafone India and Idea Cellular, thus creating the country’s largest telecom operator in terms of revenue and subscribers. Sources said the DoT has given the final approval. Now, both the operators will have to move to the Registrar of Companies (RoC) for the final leg of formalities, after which the merged entity will be listed as Vodafone Idea Ltd on the stock exchanges. The nod came after the two companies had paid the Rs 7,268-crore dues earlier this week towards spectrum charges. Of the Rs 7,268-crore demand raised by the DoT, Rs 3,322 crore is on Idea towards one-time spectrum charge (OTSC) for spectrum held beyond 4.4 MHz.
With eye on debt recovery, SBI asks DoT not to revoke RCom’s spectrum
Fearing a massive haircut on its loans, State Bank of India (SBI), the country’s largest lender, has moved the Department of Telecommunications (DoT), asking it to reconsider its decision to revoke the spectrum allocated to debt-ridden Reliance Communications (RCom) and Reliance Telecom (RTL). SBI, which is part of a consortium of lenders to RCom, has maximum exposure, as lead lender, to the beleaguered telecom company. In its letter to DoT, SBI said RCom’s spectrum, along with other telecom infrastructure and assets, is proposed to be sold to Reliance Jio Infocomm (RJio). The proceeds of the sale will be used to clear RCom’s debt of 45,000 crore.
About the Author
