The Securities and Exchange Board of India has directed Vistaar Capital Advisors (VCAL), its trustee and directors to wind up Vistaar Religare Media Fund, a venture capital fund that funded films, by providing exit to unitholders within six months, and barred VCA from accessing the capital market.
The order follows an inspection of the fund between 2008 and July 2017. VCAL is the investment manager to the fund, while Vistra ITCL (India) is the trustee of the fund. The fund, which was launched in 2008 and raised funds to the tune of Rs 43 crore, was supposed to close in 2013 as no extension was granted. The fund made 52.72% of its total investments in five SPVs, in violation of VCF Regulations, which provide that not more than 33.33% of investible funds of a fund can be invested in SPVs.
The fund did not maintain the records of complaints received by it and did not take any step to reply to the complainants or redress the same. There was absence of records with respect to details of investments and exits by the fund. Two separate valuations of all the assets of the scheme of the fund will be obtained from two registered valuers. The NAV of the scheme will be determined on the basis of the higher of the two valuations or Rs 4 million, whichever is higher.
Exit to the investors will be provided first, by offering an option to the existing investors by way of in specie distribution of interest, rights stakes or shares in the investee companies/projects. Investors who do not exercise their option for in specie distribution, shall be given the exit on the basis of the NAV.