Videocon auction: Banks may appoint common financial advisor

Lenders are trying to avoid an Amtek Auto-like situation where bidders had to submit a separate resolution plan for all entities with linked operations, which ultimately delayed the whole process, a banking official was quoted as saying.

The proposal was discussed by all the lenders, led by State Bank of India, in a meeting on September 17 where many stakeholders gave inputs as to how this process can be made simpler. Legal advisors and resolution professionals were also present at the meeting.

Insolvency courts have admitted petitions for many entities of the Videocon Group but orders have been reserved in some cases where the promoter's arguments are still being heard.

Banks have already submitted proofs of claims against the companies and are now waiting for the formal process to begin. Once that happens, the lenders can proceed with valuation of the assets to be sold and appoint due diligence experts wherever necessary.

Videocon has split up its core electronics business into smaller entities, each of which deal with a different aspect of the larger business. Some of them are involved in manufacturing, some are responsible for distribution and sales, while others own various brands.

The company is one of the 28 defaulters identified by the Reserve Bank of India against which insolvency proceedings can be initiated.