IDBI Bank has decided to auction four newspaper titles owned by debt-ridden Deccan Chronicle Holdings Ltd ( DCHL)–namely Deccan Chronicle, Financial Chronicle, Asian Age and Telugu daily Andhra Bhoomi.
This follows the failure of the Hyderabad-based company to repay a Rs 250-crore debt.
In a public announcement, IDBI Bank stated, “As security for the financial assistance granted by IDBI Bank, DCHL along with the other co-owners has created a charge by way of hypothecation of their trademarks Deccan Chronicle, Andhra Bhoomi, Financial Chronicle and Asian Age with goodwill.”
The bank said that it had decided to transfer the trademarks to the highest bidder as DCHL had failed to repay the amount it had borrowed. The final date for bids is August 27.
This is the second attempt by IDBI Bank to sell these DCHL trademarks as the first one in February was put on hold by the Debt Recovery Tribunal.
Deccan Chronicle Holdings, which went public in 2004, took loans from several banks to expand its flagship Deccan Chronicle newspaper in several cities.
But soon, the expansion backfired as a slowdown in the economy led companies to cut spending on advertisements. A cash crunch had led the Hyderabad, south India-based company tosell its Indian Premier League cricket team, Deccan Chargers, in October.
Last month, Indiabulls Housing Finance took legal possession of the house belonging to T Urmila Reddy, mother of DCHL promoters T Venkattram Reddy and T Vinayak Reddy, for failure to repay dues of Rs 93 crore.
Just few days before that, the Chandigarh police arrested M Sukumar Reddy, one of the four independent directors who had resigned the year before from DCHL, on a cheque bouncing charge filed by Religare Finvest, which had lent Rs 100 crore to the media company. Later, Reddy was released on bail.
The Central Bureau of Investigation had started a probe into DCHL on a complaint from Canara Bank, of irregularities in the company’s balance sheet. The bank, which had done a forensic audit of the accounts, complained the balance sheet did not contain all the loans from banks. Canara had lent Rs 340 crore to DCHL.
The other lenders to DCHL have also started the process of recovery, from the beginning of this year.
