Chandra to settle debt, reclaim Dish
- Subhash Chandra’s Essel Group reached an understanding to repay the settlement amount in a phased manner by 31 March and is close to signing a definitive agreement
Essel Group founder Subhash Chandra is poised to settle the ₹6,500 crore debt it owes JC Flowers Asset Reconstruction Co. (ARC) for close to ₹1,500 crore to regain ownership of the family’s stake in assets, including Dish TV and Zee Learn, as well as three properties, including a bungalow in central Delhi.
Chandra’s Essel Group reached an understanding to repay the settlement amount in a phased manner by 31 March and is close to signing a definitive agreement, two people with direct knowledge of the development said.
Mint first broke the story on 21 July that Chandra had initiated talks with JC Flowers to buy back his family’s stake in Dish TV for close to ₹1,500 crore. However, the two disagreed on the payment deadline, with JC Flowers ARC earlier insisting on full payment by 31 January.
“Essel Group companies had a large exposure to JC Flowers ARC of ₹6,500 crore. Sometime back, Chandra had approached with an offer to settle. It took over a month, but finally, they agreed to settle the loans. Some amount pertains to Dish TV, some to Zee Learn and some other properties. The payment will be in phases, and accordingly, the shares of those companies will be transferred back," said one of the people on condition of anonymity.
A JC Flowers spokesperson declined to comment on Mint’s query, while queries sent to Essel Group did not elicit any response.
The second person, also on condition of anonymity, said this is just a transfer back of the encumbered shares, so it will not trigger an open offer. Mint could not independently verify this claim. “Dish TV shares will go back to Chandra’s brother, Jawahar Goel, who was running the DTH firm before Yes Bank invoked the pledged shares in May 2020." In December, Yes Bank transferred 445.3 million shares of Dish TV, representing 24.19% of the share capital of the firm, to JC Flowers.
While it is not clear where Chandra will get the money to settle the debt, the first person said there are certain liquidity arrangements being made, including an infrastructure asset to help repay the debt.
As of now, the Essel Group and promoter family claim to have settled debt worth ₹30,000-35,000 crore.
On Monday, the shares of Dish TV closed at ₹16.66 apiece on BSE, marking a 4.47% decrease from its previous closing price. The third-largest DTH firm has experienced significant volatility in its stock over the past year, with the stock gaining 46% in the past 12 months. Jawahar Goel owns 4.04% of Dish TV, and the family’s ownership will rise to 28.2% if the transaction is concluded.
In the past, Chandra made it clear that Dish TV belonged to his brother, Jawahar Goel, and that he forced his younger brother to merge Videocon d2h with Dish TV on the insistence of Rana Kapoor, the then chairman of Yes Bank and long-term creditor of the Essel Group. In fact, Chandra took a loan of ₹4,210 crore from Yes Bank to purchase Videocon d2h from the Videocon Group, which, in turn, used the money to pay its debt to Yes Bank. But Chandra got the debt on his books, which he couldn’t service.
