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Post SC order on stressed firms, banks move to assess value of promoters' assets

Business Line  

Armed with the Supreme Court's order on invoking personal guarantees of defaulting promoters, banks have set in motion the process to assess the value of assets held by promoters of at least 40 companies that are under the insolvency process. This includes assets owned by Kapil and Dheeraj Wadhwan of DHFL; Videocon promoters Venugopal and Rajkumar Dhoot; Lanco Infratech's Madhusudhan Rao and family; IVRCL's Sudhir Reddy; and Jatin Mehta of Winsome Diamonds. In May, the Supreme Court upheld the amendment to the Insolvency and Bankruptcy Code (IBC) that allowed lenders to invoke the personal guarantee of promoters to recover their dues. This means that if the promoter of a defaulting company does not offer a credible repayment plan, creditors can initiate bankruptcy proceedings against them.