Mumbai Bench of the National Company Law Tribunal (NCLT)NCLT) has also allowed the resolution professional’s petition to exclude the period during which the application for extension was pending before the Tribunal.
“Keeping in view the quantum of public funds and the critical nature of the business that the corporate debtor is involved in, we find it necessary to extend the time period of CIRP for the benefit of all the stakeholders involved,” said a division bench of Justice P.N. Deshmukh and Shyam Babu Gautam said in their order issued on December 2.
In the extension application, resolution professional of VOVL Praveen Navander had said that the resolution process of the company is in advanced stage and they have received revival plans from four bidders, and these are being discussed by the lenders.
The CIRP period of the company expired on November 21, 2022, prompting the RP to seek an extension to prevent forced liquidation of the firm. VOVL was admitted to the insolvency resolution process in November 2019. It has accepted liabilities of over ₹30,640 crore from financial creditors and has about ₹2,000 crore as cash balance.
Government-promoted bad bank, National Asset Reconstruction Company Limited (NARCL) has offered to take over the debt of VOVL for Rs 860 crore. Lenders have requested ARC to modify the proposal.
VOVL, promoted by Videocon Group founder and chairman Venugopal Dhoot, is in the business of investing in and holding offshore oil and gas assets through its direct and indirect subsidiaries and derives a significant portion of its value from oil and gas participates in properties. By Videocon Energy Brazil Limited (VEBL), its step-down subsidiary located in Brazil through a joint venture with Bharat Petroleum Ventures BV (VEBL)BPRL,
RP, in its application to the NCLT, contended that the revival plans received by it include transfer of VEBL’s stake in the joint venture with BPRL and certain other procedural compliances relating to issue of notices giving opportunity to BPRL and other contractual counterparties. Exercise the right of first refusal (ROFR) to match bids received in CIRP.
Issuance of notices for ROFR is a mandatory requirement under contractual arrangements that are governed by Brazilian law, and is necessary to enable lenders to effectively assess the feasibility and viability of the resolution plans achieved for the company.