In a bid to revive the scam-hit CG Power & Industrial Solutions, private firm of Bharti Airtel chief Sunil Mittal and a few investors are reportedly planning to infuse working capital for activating the company's domestic operations, said a media report.
The investors led by Mittal's private firm SBM Holdings, which holds 8.3 percent stake in CG Power as on 30 June 2019, reportedly approached lenders for rejigging the loans of the power company, said a report in The Economic Times quoting people in the know of the matter.
The investors reportedly also asked CG Power to appoint a new management team that has no link with Avantha Group, the report said. Avantha Group is an Indian business conglomerate led by CG Power's former chairman Gautam Thapar Gautam Thapar.
Besides this, the investors said they would not pay off CG Power’s loans after allegations surfaced that Thapar had siphoned off funds.
On 1 October, in a major setback for Thapar, the Securities Appellate Tribunal (SAT) rejected his petition against an order issued by market regulator Securities and Exchange Board of India (SEBI) in connection with the irregularities at CG Power and Industrial Solutions, said a report in Business Standard.
“We find no merit in the appeal filed by Gautam Thapar and others. The appellant should now file a reply by 15 October. In case the appellant requires any documents from SEBI, a formal request has to be made,” the report said citing the order of SAT Bench led by Justice Tarun Agarwala.
Last month, SEBI had barred Thapar and three other former officials from capital markets for 'serious' misstatement of accounts as well as diversion of funds, and ordered forensic audit of the company.
Besides Thapar, the other officials facing ban are CG Power's ex-CFO VR Venkatesh and former directors — Madhav Acharya and B Hariharan.
On 25 September, CG Power & Industrial Solutions had appointed Ashish Kumar Guha as its chairman after Thapar was ousted from the position in August in the wake of his alleged involvement in the irregularities.
On 10 September, CG Power chief executive officer KN Neelkant quit from all the subsidiaries of the company as investors mount pressure for his ouster for the alleged irregularities happening under his watch, sources privy to the development said.
In August, CG Power & Industrial Solutions had removed its founder Thapar as chairman of the company, prompting the tycoon to break his silence to say that there was neither any fraud nor any misappropriation of funds.
The board of the fraud-hit firm through a circular resolution approved by a majority of the members removed Thapar as the chairman, the company said in a regulatory filing.
In August this year, major financial irregularities were detected at the CG Power and Industrial Solutions. The fraud came to light during an investigation by its board that found major governance and financial lapses, including advances to related and unrelated parties as well as liabilities of the company and the group potentially being understated by hundreds of crores of rupees.
— With inputs from agencies
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Updated Date: Oct 03, 2019 16:44:41 IST