Essel Group suffers setback as SEBI chief Ajay Tyagi questions extension given by lenders for debt repayment
The fund houses had an outstanding of over Rs 11,000 crore from Essel Group and had done the unprecedented in granting it more time to repay the debts.
The market regulator said that regulations do not allow any form of standstill arrangements
Tyagi's comments indicated SEBI is not happy with the decision of the mutual fund houses
On Wednesday, Essel Group said mutual funds unanimously decided to grant it more time for repayments
A day after the Subhash Chandra-led Essel Group said mutual funds from which it borrowed money "unanimously" decided to grant it more time for repayments, market regulator SEBI has ruled out any provision of giving an extension to repay debt, said a media report.
Securities and Exchange Board of India (SEBI) chairman Ajay Tyagi said that regulations do not allow any form of standstill arrangements, said a report in Moneycontrol.
Tyagi's comments indicated that the market regulator is not happy with the decision of the mutual fund houses to grant more time to Zee Entertainment Enterprises (ZEEL), a subsidiary of Essel Group, said the report.
"We don’t know if entities are following the right regulations on standstill arrangements," Tyagi was quoted as saying in the report.
On Wednesday, Essel Group said mutual funds from which it borrowed money "unanimously" decided to grant it more time for repayments.
In a statement that comes amid media reports of a few fund houses selling their holdings in the company ahead of the 30 September deadline, the group did not specify the mutual funds which have supported it, or the amount due.
cluding infrastructure, roads and power, by pledging their holdings of ZEEL. A majority of these bets went awry and the liquidity crisis created by the collapse of IL&FS made it difficult to refinance the debt.
Simultaneously, bears mauled the ZEEL scrip as well, triggering a piquant situation where the value of security held by the lenders went down. In the face of the troubles, and with a view to protect the value, nearly the dozen MFs decided to give Essel more time.
The sell-off in the ZEEL shares was termed as sabotage by the promoters.
— With inputs from agencies
The ICC confirmed it was investigating the registration of company names which it regarded as of "concern to the sport of cricket" as reports of a rebel organisation which might split the game continued to emerge on Friday.
Essel Group promoters open to selling over 50% of their stake in Zee Entertainment, in talks with over 2 buyers
As on 31 December, 2018, promoters held 41.62 percent stake in ZEEL Entertainment Enterprises Ltd