An Uncertain Future for Videocon

Erstwhile promoter Venugopal Dhoot is in a messy situation and his businesses could go into liquidation. Of particular interest is the Ravva oilfield, in which his group owns 25 per cent stake

- KRISHNA GOPALAN

THE ARREST OF Venugopal Dhoot, Promoter of the Videocon Group, primarily known for consumer durables, once again throws open the fate of the business empire he once owned. Reeling under a mountain of debt, the fate of the high-profile group is now, at best, unknown.

Chanda Kochhar, ICICI Bank’s former MD & CEO, allegedly misused her position and granted loans to Dhoot in 2009 and 2011. Later, the CBI filed a case against Kochhar, her husband Deepak, and Dhoot. The allegation was that Dhoot had invested in NuPower Renewables, a company co-founded by Deepak Kochhar, after having obtained the loans. In 2012, these loans were declared as non-performing assets.

In mid-2021, Vedanta group company Twin Star Technologies had offered ₹2,962 crore for Videocon Industries against admitted claims of ₹64,938 crore of the secured financial creditors. That translates to 4.15 per cent of the claims for all creditors and 5.33 per cent for financial creditors. The liquidation value of Videocon was ₹2,568 crore and the insolvency tribunal had then expressed surprise over the similarity of the bid value and the liquidation value. Twin Star’s offer was to buy out 13 companies of the Videocon Group, which included consumer electronics, home appliances, oil and gas, telecom and electronics retail. The diversification spree and the somewhat easy access to bank loans led to the expansion of the Videocon Group. However, huge setbacks like the 2G spectrum scam followed by the cancellation of telecom licences did Dhoot in.