The National Company Law Tribunal (NCLT) has approved Chemhub Tradelink’s resolution plan for Pancard Clubs, which has debt claims of around Rs 8,900 crore, which is leading to 8% recovery for creditors.
Ahmedabad-based Chemhub Tradelink’s plan was approved with 100% majority in the committee of creditors. It was among three bidders that included Ashdan Properties and a consortium led by Vijay K. Oswal and Shanti Hospitality.
The plan includes a total payout of Rs 707 crore, with a large portion allocated for creditors’ settlements, of around Rs. 697 crore. Under the plan, the successful bidder has proposed some upfront payments and deferred payments over several years.
Pancard, specialising in hotel and resort development and operations, has 1.5 million financial creditors, primarily timeshare subscribers. It has been undergoing an in-court resolution process since September 2022.
Rajesh Sureshchandra Sheth, backed by Deloitte, was the resolution professional overseeing the restructuring process. Advocate Nausher Kohli appeared for the lenders in the company.
The winning bidder will pay Rs 10 crore toward CIRP (Corporate Insolvency Resolution Process) costs upfront and Rs 15 crore as an upfront payment to financial creditors. Additionally, a structured deferred payment plan of Rs 46.22 crore, spread over three years, is proposed, which will be a phased settlement approach.
The resolution plan includes provisions for sharing a percentage of net recovery amounts, with a minimum committed payout of Rs 200 crores if certain conditions are not met within the stipulated time frame.
“This case is unique in the history of the insolvency era as the claimants were small investors spread across India,” said Madan Vaishnava an independent RP. “In this matter, properties were attached by SEBI and directors were not cooperative since the start of the process. At last, justice has prevailed and small investors have got relief and will get their dues.”