Media company BCCL invested in Mehul Choksi corporations, HT Media ‘evaluated’ however didn’t seal deal

Written via Khushboo Narayan
| Mumbai |
Up to date: February 22, 2018 7:01 am

A sealed showroom of Mehul Choksi’s Nakshatra in Kolkata. (Specific Photograph: Partha Paul)

Media company Bennett, Coleman & Co. Ltd (BCCL) invested in firms of Mehul Choksi-promoted Gitanjali Crew, which is now below the scanner of probe businesses in reference to the Punjab Nationwide Financial institution transactions fraud allegedly involving 3 corporations of the crowd, in keeping with paperwork accessed via The Indian Specific.

The paperwork display that some other media team, HT Media Ltd, was once in talks to put money into Gitanjali Gemstones Ltd and the jewelry company had even won approval from its shareholders to allot debentures to the media company on December 1, 2017, in keeping with a submitting with the BSE Ltd.

Consistent with the paperwork, the BCCL, which runs The Occasions of India and The Financial Occasions, has been allocated 5 convertible warrants of Rs 32.five crore in each and every of the 2 subsidiaries of Gitanjali Gemstones Ltd, Nakshatra Manufacturers Ltd and Gili India Ltd, in keeping with board resolutions of those corporations of August 2017 and October 2017 respectively.

Learn | Nirav Modi, Mehul Choksi PNB scandal: Glossed over, auditors flagged mortgage default, foreign exchange violations

When it comes to indexed information company HT Media Ltd, which runs Hindustan, The Hindustan Occasions and Mint, Gitanjali Gemstones Ltd had won approval from participants of the corporate to allot ten totally convertible debentures (FCDs) value Rs 30.67 crore to HT Media, in keeping with a different answer of the corporate on December 1, 2017.

On the other hand, in accordance with queries from The Indian Specific, Piyush Gupta, leader monetary officer of HT Media, mentioned the corporate didn’t put money into Gitanjali Gemstones even though it had “evaluated” and “regulatory filings had been carried out” for the allotment.

“HT Media has now not invested in those firms. It was once evaluated, regulatory filings had been carried out, however was once by no means carried out,” Gupta mentioned in a commentary.

Defined | Punjab Nationwide Financial institution fraud: How the device was once gamed

Emails to Raj Jain, leader govt officer of BCCL, and call calls to his place of business didn’t elicit any reaction.

On January 31, two months after the December 1 board answer, the CBI booked Choksi, diamantaire Nirav Modi and his spouse Ami and brother Nishal in reference to a Rs 280-crore dishonest case after receiving a grievance from the PNB. Due to this fact, the state-owned lender, in a regulatory submitting on February 14, revised the volume of fraudulent transactions to Rs 11,400 crore.

It’s not unlawful for a corporation to factor convertible warrants or debentures. Corporations factor such tools once in a while to boost cash from traders.

“The warrants might be convertible (on the sole choice of the BCCL) at any time inside a length of 5 years from the date of allotment… BCCL shall, at the date of allotment of warrants, pay an quantity similar to 10 in step with cent of the entire attention in step with warrant,” mentioned the phrases and prerequisites of the allotment via each Nakshatra Manufacturers and Gili India.

The board resolutions additionally mentioned that if BCCL does now not convert its warrants within the two firms inside 59 months from the allotment date, Nakshatra Manufacturers and Gili India pays BCCL Rs 38.five crore each and every when the warrants are surrendered.

Gili India, in its explanatory commentary to the allotment of warrants to BCCL, mentioned “the thing of the problem is to mobilize finances to satisfy the quick and long run monetary requirement, basic company goal and emblem development”.

Gitanjali Gemstones, in keeping with its December 1 particular answer, mentioned that in opposition to each and every FCD, HT Media will “be entitled to use for and search allotment of fairness stocks, at its choice, inside length now not exceeding 18 months from the date of factor” of the FCD.

“The thing of this factor is to mobilize finances to satisfy operating capital necessities and basic company goal,” Gitanjali Gemstones mentioned in its explanatory commentary at the factor.

Gitanjali Gemstones is a indexed company of the Gitanjali Crew. The corporate reported a consolidated benefit after tax of Rs 65.6 crore for the 3rd quarter ended December 2017. Nakshatra Manufacturers and Gili India are subsidiaries of Gitanjali Gemstones.

The marketplace capitalisation of Gitanjali Gemstones has nearly halved from Rs 693 crore to Rs 360 crore since February 14 when PNB first alleged that the companies of Choksi and Nirav Modi had been desirous about fraudulent transactions value Rs 11,400 crore.

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