Business News at 10:00 am on 1st April 2023

We begin the weekly roundup with latest on Adani saga. Adani Group this week sought to refute a media report raising questions about completion of repayment of $2.15 billion in share-backed debt, saying that it has completed the full prepayment of $2.15 billion loans, paying off all share backed facilities availed by the promoters. This has freed up substantial share pledges for listed entities Adani Green, Adani Ports, Adani Transmission, and Adani Enterprises, leaving only residual share pledges on outstanding loans availed by respective operating companies, Adani Group said in a late night statement. The statement showed that between 31 December 2022 and now, the share pledges have reduced from 4.4% to 3.5% for Adani Green; from 17.3% to 4.7% for Adani Ports; from 6.6% to 3.8% for Adani Transmission; and from 2.7% to 0.6% for Adani Enterprises. “After such repayment… only residual share pledges corresponding to Operating Company facilities remained outstanding,” Adani Group said, adding: “OpCo facilities are availed by respective OpCo, and are part of their existing debt structure, and no new OpCo facilities have been availed since the short-seller report.”

Moving on. Lenders of debt-ridden Reliance Capital on Monday decided to go for a second auction on April 4 in their bid to maximise recovery as part of the resolution process, sources said. According to sources, IndusInd International Holdings Ltd of Hinduja Group on Monday told the Committee of Creditors it will retain the earlier bid of Rs 9,000 crore upfront cash. The 38th meeting of the CoC on March 23, 2023 was adjourned and the adjourned meeting was subsequently held today i.e. Monday, RCAP said in a regulatory filing. For a fresh round of bidding, CoC decided to set the base bid at Rs 9,500 crore on a Net Present Value basis, with a minimum cash component of Rs 8,000 crore. Earlier, the Supreme Court on March 20, 2023, admitted the appeal of Torrent Investments — the highest bidder with Rs 8,640 crore resolution plan — against the lenders’ decision to hold another round of auction.

In other news, the National Company Law Appellate Tribunal on Wednesday upheld the Rs 1,338-crore penalty imposed by the Competition Commission of India on Google, but also provided substantial relief to the tech giant by way of modifying four key clauses of the antitrust regulator’s order. As a result, Google will now not need to allow hosting of third-party app stores on its Play Store or allow users to remove its pre-installed apps such as Google Maps, Gmail and YouTube. Google can also continue to place curbs on distributing apps through sideloading and need not share its proprietary Play Services APIs with rivals, original equipment makers and developers. So, in effect, while the NCLAT order has upheld the CCI verdict which found Google guilty of abusing its dominant position, it has restored the manner in which the tech giant operated its Play Store and other services which govern the Android ecosystem.

Moving on. Zee Entertainment Enterprises has reached a settlement with IndusInd Bank in relation to their payment dispute, following which the private lender would withdraw insolvency proceedings initiated against the media firm. This is important as ZEEL, an Essel Group company promoted by media baron Subhash Chandra, is close to completion of its earlier announced merger with Culver Max Entertainment (formerly Sony Pictures Networks India) to create the country’s largest media firm. The company and IndusInd Bank have mutually entered into the settlement agreement on such agreed terms by which all disputes and claims have been settled between the firm and the lender. There is no penalty paid and no material impact on the financial position of the company, ZEEL said in a regulatory update. In February, the National Company Law Tribunal’s (NCLT) Mumbai bench permitted initiation of insolvency proceedings against ZEEL, after it admitted a petition filed by IndusInd Bank. The case dates back to February 2020, when IndusInd Bank sought a payment of more than Rs 83 crore from ZEEL and accused the latter of failing to fulfill obligations under a Debt Service Reserve (DSR) account agreement.

And finally, a big news from China. Alibaba Group Holding Ltd is planning to split its business into six main units covering e-commerce, media and the cloud, the company said on Tuesday, adding that each of the units will explore fundraising or initial public offerings. U.S.-listed shares of Alibaba rose 3.5% in trading before the bell. The six units will include Cloud Intelligence Group, Taobao Tmall Commerce Group, Local Services Group, Cainiao Smart Logistics Group, Global Digital Commerce Group and Digital Media and Entertainment Group. Each of the six will be managed by its own CEO and board of directors.