MGM Healthcare MD’s bid to take over Appu Hotels Ltd. stayed

The National Company Law Appellate Tribunal (NCLAT), Chennai has stayed the implementation of an order approving MGM Healthcare managing director M.K. Rajagopalan’s ₹423 crore bid to take over Appu Hotels Limited. Appu Hotels owns and operates Le Meridien in Chennai and Coimbatore.

The National Company Law Tribunal (NCLT), Chennai had approved of the bid. Against this, Periasamy Palani Gounder, promoter & erstwhile director, Appu Hotels, moved the NCLAT. In his petition, he alleged that the whole ‘Resolution Process’ was vitiated by numerous statutory violations of the provisions of the Insolvency and Bankruptcy Code. The resolution professional, Radhakrishnan Dharmarajan, and Rajagopalan were named as respondents.

Mr. Periasamy alleged that Rajagopalan was put in a pole position to acquire assets worth over ₹1600 crore for a paltry sum of ₹423 crore. Mr. Periasamy also said he is ready to pay all the financial creditors, operational creditors and unsecured financial creditors. He also said he would deposit ₹450 crore and he required two or three days’ time in this regard.

He argued that NCLT had failed to interfere with the attempt to acquire the assets of Appu Hotels for less than 25% of its actual value, while the promoters’ were ready and willing to infuse more funds than Rajagopalan and to settle all the creditors in an expeditious manner.

The respondents argued that NCLT approval was valid.

NCLAT said submissions projected on either side require a detailed rumination and granted the respondents two weeks time to file detailed replies against the appeal and stayed the implementation of the NCLT order till the next date of hearing.

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Printable version | Sep 23, 2021 2:33:01 PM |

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