Deccan Chronicle loan recast decision deferred

There is a correction in this article, which can be seen at the end.

Lenders with exposure to Deccan Chronicle Holdings, the parent company of the Deccan Chronicle newspaper and Indian Premier League team Deccan Chargers, on Wednesday held a meeting to consider the proposal of corporate debt restructuring (CDR) for loans to the troubled company. However, a decision on the matter was put on hold till the next meeting scheduled for September 26.

According to the terms and conditions of the CDR process, for a debt restructuring programme to be planned, at least three-fourths of the company’s lenders have to agree on restructuring the company’s loans. In the case of Deccan Chronicle Holdings, a few lenders are expected to decide on the matter in the next few days.

Deccan Chronicle Holdings’ total debt to be restructured is about Rs 2,300 crore, while total exposure to the company is about Rs 5,000 crore.

The top lenders whose exposure to the company would be considered by the CDR cell are ICICI Bank, Axis Bank, Canara Bank, IDBI Bank and Andhra Bank. The collective exposure of these lenders is Rs 1,700 crore.

Yesterday, Financial Services Secretary D K Mittal had said Canara Bank was carrying out a forensic audit of the company. “If the audit establishes a fraud in the company, it won’t be considered for CDR,” said a public sector bank executive privy to the development.

Correction: The collective exposure of lenders has been incorrectly identified as Rs 2,700 crore, which is actually Rs 1,700 crore.