Essel Group founder Subhash Chandra has publicly called for an independent audit to scrutinise the group’s debt, asserting that a significant Rs 43,000 crore of its total Rs 45,000 crore debt has already been repaid, amidst ongoing allegations and financial scrutiny.
Key Points
- Essel Group founder Subhash Chandra claims the group has repaid approximately Rs 43,000 crore of its Rs 45,000 crore total debt.
- Chandra has urged the banking system and Finance Minister Nirmala Sitharaman to appoint an independent auditor to review the group’s financial position.
- He clarified that the National Company Law Tribunal (NCLT) matter involves around Rs 3,900 crore, not Rs 22,000 crore as alleged, with some claims already repaid.
- Chandra attributed the group’s financial problems, which surfaced in January 2019, to an asset-liability mismatch and acknowledged his mistakes.
- He plans to rebuild his career by working with investment professionals and investing family money in startups, while also addressing misinformation circulating online.
Essel Group founder Subhash Chandra on Friday said that the group has repaid approximately Rs 43,000 crore of its Rs 45,000 crore total debt.
He urged the banking system and Finance Minister Nirmala Sitharaman to appoint an independent auditor to review the group’s borrowings, defaults, and repayments.
Chandra addressed what he described as allegations and speculation surrounding him, his family, and the group’s financial position.
He said the group’s problems began surfacing on January 24, 2019, because of an asset-liability mismatch.
He said he then wrote an open letter to the banking system, acknowledging his mistakes and committing to repay the debt of the group and its borrowing entities.
Addressing Debt Repayment and NCLT Claims
“I am the first person to accept that I made a mistake in the corporate world,” Chandra said, adding the group sold family and personal assets to meet obligations.
“The group had almost sold Zee and his house was also mortgaged to raise funds, Chandra argued.
“We didn’t keep anything,” he said.
Chandra said the group’s total loan amount was Rs 45,000 crore, of which Rs 43,000 crore had been repaid, while around Rs 2,000 crore remained stalled because of asset-liability issues.
In the proceedings before the National Company Law Tribunal (NCLT), Chandra said the matter relates to personal guarantees he had provided to certain lenders. He said some lenders had already been repaid but nevertheless filed claims before the tribunal.
Clarifying Financial Figures and Future Plans
Chandra rejected claims that the NCLT matter involved Rs 22,000 crore, clarifying that the actual amount was around Rs 3,900 crore.
He noted about Rs 620 crore in claims linked to borrowing entities had already been repaid, while a settlement offer of roughly Rs 1,100 crore remained pending before certain lenders.
“As a group, we are committed to paying back the lenders,” he said.
He said the group remained stuck in some areas, particularly infrastructure, where payments were due from state governments.
The group would also need to sell one or two properties, he added.
Some people, he said, had taken the group’s market capitalisation and presented it as his personal net-worth. He pointed to an alleged figure of Rs 35,000 crore reported in 2017 as an example of this misunderstanding.
The Essel group founder said that when he became a Rajya Sabha member in 2016, his declared net-worth was around Rs 339 crore.
Chandra called for an independent audit to establish how much the group had borrowed when it first defaulted and how much it had subsequently repaid. He said he now had around Rs 6.5 crore left, which he would also use towards repayment.
He also said that he had rented out a part of his house to meet his expenses.
Looking ahead, Chandra said he planned to work with investment professionals in Switzerland and invest family money in startups as he sought to rebuild his career.
He also urged people to verify claims about him circulating on WhatsApp and social media, saying ultimately “truth will prevail”.
