IFCI takes Koutons chief's property mortgaged to raise working capital
Mindless Politics and Irresponsible behavior by the Political Outfits like the BJP, the Communists and their cohorts are responsible for the continuance of the pitiable conditions of Retail Companies in India. These people should first introspect, before coming down heavily on the UPA government's performance!!
The red ink at Koutons Retail is beginning to leave its mark on the founder's personal wealth.
Finance company IFCI recently attached a motel complex on the Delhi-Chandigarh highway that founder-chairman DPS Kohli had mortgaged as collateral while raising working capital for Koutons from the finance company. After defaulting on payments, IFCI attached the Haveli Hospitality complex a month ago. IFCI's associate firm Hardicon is now running the complex, an IFCI spokesperson said.
Located at Karnal, Haveli is popular among tourists for its 22-room hotel,restaurants, banquet halls and an amusement park. Koutons' Kohli did not respond to calls and text messages on his mobile phone.
In a separate development, Koutons told the Bombay Stock Exchange on January 27 that IFCI has invoked almost 0.6% of shares held by founder Kohli. In April 2011, in a similar fashion IFCI had invoked shares pledged by the promoters taking the finance company's share in Koutons to 10.24%.Kohli, along with other promoters had pledged almost 98% of their holdingin the company to the lenders in December 2010.
With debt and inventory piling up after the 2008-09 slowdown, Koutons is struggling to stay afloat, like many other retailers. Once a high-flying emerging retailer, the company is facing several winding-up petitions after defaulting on payments to vendors and financiers. At its July 2007 debut on the BSE, the Koutons scrip had soared 25% over issue price to close atR590. The stock has now lost almost 97% of its value and is trading at R16.55.
In September, Koutons told the BSE that lenders like Indian Overseas Bank, Punjab National Bank, Bank of India and Bank of Baroda had approved a corporate debt restructuring of its R660 crore debt.
The post-2008 slowdown hit India's nascent retail sector hard, with many companies, including discount store chain Subhiksha Trading Services, local franchisee of US-based MyDollarStore Inc, Superstore 1 and a stationery chain from Indo Rama Group among various other retailers going bust.
Subhiksha's peer Vishal Retail was rescued by a buyout by an alliance of US-based private equity TPG Capital and Chennai-based Shriram Group. Those who survived the slowdown were also badly impacted as most of the retailers trimmed expansion, laid off employees and closed thousands of stores across the country.
Even big retail players like the Future Group have huge debts on their books and are looking at opening of foreign investment for the sector to enable them get funds for expansion and consolidate their operations.
In November last, the government opened the multi-brand retail sector to foreign direct investment by allowing overseas retailers to pick up to 51%stake in Indian retail companies. But because of strong political opposition, even from certain allies, the government had to roll back the decision. However, last month the government increased the FDI limit in single-brand outfits from 51% to 100%.
Located at Karnal, Haveli is popular among tourists for its 22-room hotel,restaurants, banquet halls and an amusement park. Koutons' Kohli did not respond to calls and text messages on his mobile phone.
In a separate development, Koutons told the Bombay Stock Exchange on January 27 that IFCI has invoked almost 0.6% of shares held by founder Kohli. In April 2011, in a similar fashion IFCI had invoked shares pledged by the promoters taking the finance company's share in Koutons to 10.24%.Kohli, along with other promoters had pledged almost 98% of their holdingin the company to the lenders in December 2010.
With debt and inventory piling up after the 2008-09 slowdown, Koutons is struggling to stay afloat, like many other retailers. Once a high-flying emerging retailer, the company is facing several winding-up petitions after defaulting on payments to vendors and financiers. At its July 2007 debut on the BSE, the Koutons scrip had soared 25% over issue price to close atR590. The stock has now lost almost 97% of its value and is trading at R16.55.
In September, Koutons told the BSE that lenders like Indian Overseas Bank, Punjab National Bank, Bank of India and Bank of Baroda had approved a corporate debt restructuring of its R660 crore debt.
The post-2008 slowdown hit India's nascent retail sector hard, with many companies, including discount store chain Subhiksha Trading Services, local franchisee of US-based MyDollarStore Inc, Superstore 1 and a stationery chain from Indo Rama Group among various other retailers going bust.
Subhiksha's peer Vishal Retail was rescued by a buyout by an alliance of US-based private equity TPG Capital and Chennai-based Shriram Group. Those who survived the slowdown were also badly impacted as most of the retailers trimmed expansion, laid off employees and closed thousands of stores across the country.
Even big retail players like the Future Group have huge debts on their books and are looking at opening of foreign investment for the sector to enable them get funds for expansion and consolidate their operations.
In November last, the government opened the multi-brand retail sector to foreign direct investment by allowing overseas retailers to pick up to 51%stake in Indian retail companies. But because of strong political opposition, even from certain allies, the government had to roll back the decision. However, last month the government increased the FDI limit in single-brand outfits from 51% to 100%.
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