Tag Archives: Bankruptcy

McDonalds faces major shutdown, Provisioning halts insolvency recovery, VIVO wins IPL bid- Weekly Digest #46

Monday- 26th June 2017

  • The government has relaxed GST provisions for e-commerce as it has deferred provision that required e-commerce players such as Amazon and Flipkart to deduct tax on payments made to their vendors and small businesses that sell through these e-commerce platforms don’t have to register themselves immediately.
  • SBI has mandated Alvarez & Marsal to act as interim resolution professional to reorganise Ruias-owned Essar Steel that defaulted on ₹4,000 crores. PwC, EY and Deloitte have also been hired to handle insolvency proceedings.
  • Apple CEO Tim Cook has reportedly told the Prime Minister that Apple had started production of iPhone SE in Bengaluru last month, during a meeting with American business leaders in Washington on Sunday.

 

Tuesday- 27th June 2017

  • After RBI announced banks to have hefty provisions for proceedings under the bankruptcy code, major tumble in prices of the banks’ stocks was observed. The Nifty PSU Bank dipped 3.4% to 3,328 points, its one month low.
  • Vivo won the sponsorship of IPL for the next five years by bidding a record-breaking sum of ₹2,199 crores. The base price was ₹120 crore per season.
  • Coca-Cola is shutting down its biggest analytics, technical and innovation centre in India which is located in Pune. This comes as a part of a restructuring to head towards a leaner organisation.
  • To comply with the RBI norms, RIL is seeking shareholders’ approval for a limit on non-promoter investors’ holding to 5%.

 

Wednesday- 28th June 2017

  • Banks to lobby RBI to relax its strict provisioning norms for accounts referred to the country’s bankruptcy courts. Banks feel it will hamper heir ability to find buyers at a good price.
  • The cabinet has cleared formation of a panel under the Finance Minister Arun Jaitely to decide on the extent to which Air India would be privatised and process to be followed for the same.
  • The internal conflict between Connaught Plaza Restaurants, a local joint venture between Vikram Bakshi and the US-headquartered McDonald’s took an ugly turn as with the CPRL board deciding to shut down 43 out of 55 restaurants in Delhi.
  • Zomato India reported a 34% decline in loss from ₹590 crores to ₹389 crores owing to a strategy that excluded self-fulfilled deliveries. It has enabled the startup to be valued at more than $1 billion.
  • Japanese drugmaker Daiichi Sankyo has moved to NCLT to stop former Ranbaxy promoters, Singh brothers from splitting hospital and diagnostics businesses of Fortis Healthcare. Daiichi has claimed that demerger will make the recovery from Singh brothers more difficult.

 

Thursday- 29th May 2017

  • IndiGo has expressed its interests in buying a stake in debt-laden Air India after the cabinet approved a proposal to dilute state ownership in the company.
  • As a part of changes in the Legal Metrology (Packaged Commodities) Rules, 2011, w.e.f. January 1, 2018, companies will be forbidden from selling the same product at different MRPs at locations such as restaurants and airports.
  • Credit-rating agency Crisil has acquired a 8.9% stake in in local rival Credit Analysis & Research which can potentially lead to acquiring the company. Crisil purchased 26.22 lakh shares at ₹1659.79 per share in a deal valued at ₹435.26 crores.
  • Ministry of Corporate Affairs has amended the Legal Metrology (Packaged Commodities) Rules, 2011 to make it compulsory for e-commerce companies to declare expiry dates and maximum retail prices of packaged consumer products online.

 

Friday- 30th May 2017

  • CDSL made a stellar debut in the market, with shares listed at 67.7% premium at ₹250, over the issue price of ₹149. The share price surged further and closed at ₹260.70.
  • ICICI bank to raise an amount of ₹25,000 crores by issuing securities on a private placement basis. the proceeds are to be utilised for increasing lending operations.
  • The Competition Commission of India has approved Bharti Airtel’s acquisition of Videocon Telecom and Aircel Ltd’s airwaves

 

Source: The Economic Times
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Bankruptcy proceedings, TATA Group to acquire Air India, IHH withdraws from Fortis- Weekly Digest #45

Monday- 19th June 2017

  • Sensex closed at a record high of 31,311 points and Nifty at 9,657 points as RBI asked lenders to start bankruptcy proceedings against big defaulters. It has raised the hopes of a speedy resolution to the bad loans issue.
  • The Income tax department has demanded all dividends due to Cairn Energy Plc from Cairn India (Vedanta Ltd) against part of the ₹10,247-crore tax levied on the company due to the retrospective amendment.
  • Mercedez-Benz has named Piyush Arora, present head of manufacturing at its Pune plant as the person-in-charge for its South-East operations.
  • Volkswagen has named Steffen Knapp as the director as the director of Volkswagen Passenger Cars India. He succeeds Michael Mayer, who is now head of sales and marketing for VW China.
  • IDBI bank took bankruptcy proceedings against Lanco Infratech as it took the resolution to the insolvency courts. The stock tanked by 20% after this news.

 

Tuesday- 20th June 2017

  • ABB, the Swedish-Swiss multinational, is in discussions with Larsen & Toubro to acquire its electrical and automation division. The deal is to be expected to be valued at ₹14,000-18,000 crores.
  • Reliance Communications, under the pressure from its lenders, has put its property monetization exercise on fast-track and is targeting an overall 80% (₹45,000 crores) by December 2017.
  • Adani Ports and Special Economic Zone plans to raise at least $500 million through overseas bond sales. The amount to be utilised for refinancing some current loans and fund expansion.

 

Wednesday- 21st June 2017

  • The SEBI eased rules on the restructuring of distressed companies, making it easier for banks to sell them off. Sebi also tightened the rules for participatory to clamp down on possible misuse of the instrument.
  • The government has given banks, post offices and district central cooperative banks a month’s time to deposit any demonetised currency still in their possession.
  • The Tata Group plans to buy the stake of debt-ridden Air India. It plans to acquire 51% stake in the carrier company. Interestingly, Air India was founded 85 years ago by Tata Group.
  • The government sold its 2.5% stake in L&T to state-run entities, including SBI and LIC, for about ₹4,200 crore.
  • With bids cumulating at ₹62,500 crores, CDSL’s IPO oversubscribed by 170 times. It has set the subscription record in the history of D-street. QIP subscribed 149 times while the HNI was subscribed at 563 times.

 

Thursday- 22nd May 2017

  • SBI has been authorised to refer Essar Steel, Bhushan Steel and Electrosteel to the bankruptcy court. This has raised the possibility that some of these companies could be merged in an effort to return them to health.
  • Integrated Healthcare Holdings of Malaysia has abandoned its pursuit of Fortis Healthcare and SRL Diagnostics, thus dampening the efforts of its promoters to reduce their debt by selling off their healthcare assets.
  • Reliance Industries and partner BP have withdrawn the gas price-related arbitration against the government. This will enable the companies to claim the premium price for output from deep-sea fields.
  • Rural Electrification Corp plans to raise $300 million by selling bonds to overseas investors. The proceedings to be utilised to finance environment-friendly projects.

 

Friday- 23rd May 2017

  • PNB has been given green signal to begin bankruptcy proceedings against Bhushan Power and Steel. It is one of the largest defaulters among the 12 companies identified by the RBI.
  • Wall Street Journal reported that the British drinks giant Diageo were aware that the United Spirits Ltd management, led by Vijay Mallya, had diverted money to the nearly-bankrupt Kingfisher Airlines before it took over the Bengaluru-based spirits firm.
  • Fortis stock plunged by 13% to ₹172.30 following IHH Healthcare’s decision to back out of a deal to buy a controlling stake.

 

Source: The Economic Times
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GST Council set rates, Bad loans under Bankruptcy Code, Hyundai Fined by CCI- Weekly Digest #44

Hello, readers. I hope you are doing fine. I would like to apologise for the absence for over five weeks. It was due to medical necessities. I hope this will not repeat anytime soon.

Monday- 12th June 2017

  • GST council lowers rate on 66 household and other essential items such as Cashew nuts, insulins, cutlery, printer and others and raised the threshold for the scheme as it inches closer towards July 1 deadline.
  • As per the Finance Minister Arun Jaitley, RBI is drawing up a list of debtors with bad loans that need to be resolved under the Insolvency and Bankruptcy Code.
  • Anticipated acquisition of  Snapdeal by Flipkart will have to deal with RBI on Foreign Exchange to protect the interests of the shareholders. Issuance of shares by Flipkart Singapore to Indian shareholders of Snapdeal would need a specific permission from RBI.
  • Catholic Syrian Bank has proposed a 51% stake sale to Canada’s Fairfax Financial Holdings Ltd at ₹160 per share. The proposed deal will value the company at ₹1,300 crores.

 

Tuesday-13th June 2017

  • RBI issued a statement that under new Insolvency and Bankruptcy code, 12 accounts totalling about 25% of the current gross NPAs of the banking system would qualify for immediate reference under the Insolvency and Bankruptcy Court.
  • CBEC has stated that import of 4G equipment by Indian telecom firms doesn’t fall within the purview of the global Information Technology Agreement and hence won’t be exempted from the customs duty.
  • The Broadband India Forum has written a letter to IT and telecom secretary Aruna Sundararajan that India could attract serious legal challenges and retaliatory action from key Asean countries if it decides to slap customs duty on imported handsets. However, Indian Cellular Association’s president, Pankaj Mohindroo said that government is elected not for Asean but to serve the people, and industry, in India.
  • Ola raises an amount of $50 million from New York-based investment firm Tekne Capital Management. This pushes the value of the company to $3.65 billion.

 

Wednesday- 14th June 2017

  • Tata Sons is considering a forensic audit of last year’s purchase of Welspun Renewables Energy for ₹9,249 crore by Tata Power Ltd because of concerns over corporate governance, allegedly inflated valuations and the unusual swiftness in execution.
  • The union cabinet approved the Financial Resolution and Deposit Insurance Bill, 2017. This will complete the country’s bankruptcy framework after it’s passed by parliament.
  • Competition Commission of India has imposed a penalty of ₹87 crores on Hyundai as it imposed arrangements upon its dealers that resulted in resale price maintenance -a deal not to sell a product below a specified price -in the sale of passenger cars manufactured by it. This is in contravention to the Competition Act.
  • Anil Ambani has voluntarily given up all his salary and commission until March 2018 from debt-laden and loss-making telecom arm, Reliance Communications.

 

Thursday- 15th June 2017

  • RIL and BP to invest an amount of ₹40,000 crores in the Krishna-Godavari Basin to produce 30-35 million cubic metres a day of gas.
  • India is close to imposing a 10% basic customs duty on smartphones. The decision is expected to be announced shortly before the rollout of the GST.
  • A Warburg Pincus affiliate to invest $360 million for a 43% stake in Tata Technologies Limited. 30% stake will be acquired from Tata Motors and 13% stake from Tata Capital.
  • A consortium of 24 lenders, led by the SBI to sell a majority stake in Adhunik Power & Natural Resources to Edelweiss Group. The lenders will receive cash upfront on sale of distressed assets.

 

Friday- 16th June 2017

  • The government has made it mandatory to furnish aadhaar along with PAN to enable bank opening and any financial transaction over ₹50,000.
  • Airtel, Vodafone and Idea have claimed that Jio’s claims for losses due to debt are false and loss has been incurred due to high government fees as well as the newcomer’s free offers.
  • Optical network equipment manufacturer Tejas Networks’ IPO to raise an amount of ₹776 crores ended as the issue was subscribed 1.9 times. The offer was priced at ₹250-257 per share.
  • Amazon to acquire Whole Foods Market Inc for $13.7 billion. However, Whole Foods’ founder John Mackey will continue to run the business.

 

Source: The Economic Times
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