QBiz: Rotomac Head Arrested; 5K Aircel Employees to Hit Job Street
Here are the top business stories of the day.
1. Rotomac Owner Vikram Kothari Arrested by CBI
The Central Bureau of Investigation on Thursday, 22 February, arrested Rotomac owner Vikram Kothari and his son, Rahul – both directors in the company – for alleged default on loan repayments to the tune of Rs 3,695 crore, officials said in New Delhi.
Kothari, who was called at the agency headquarters here for questioning, and Rahul were not cooperating in the investigation that led to their arrest, they said.
A consortium of seven nationalised banks has given bank loans worth Rs 2,919 crore from 2008 onwards to Rotomac Global Pvt Limited, the CBI FIR has alleged.
The amount swelled to Rs 3,695 crore, including the accrued interest, because of repeated defaults on payment, the officials said.
2. ED Seizes Rs 100 crore Deposits, Luxury Cars of Nirav Modi
Intensifying the crackdown on the Nirav Modi and Mehul Choksi groups, the Enforcement Directorate on Thursday, 22 February, said it has frozen their shares, deposits and luxury cars worth over Rs 100 crore in the money laundering probe against them in the Rs 11,400-crore alleged PNB fraud.
Income Tax Department officials said property worth Rs 1,200 crore of the Gitanjali Group located in the Special Economic Zone (SEZ) in Hyderabad has been attached in a fresh action.
Nirav Modi, the billionaire diamond king under the scanner of various investigating agencies, failed to depose before the ED after summons were issued to him, agency officials said.
The officials said that Modi, who was summoned for today by the agency under a section of the Prevention of Money Laundering Act (PMLA), has now been asked to join investigations and appear before the ED in Mumbai on 26 February.
3. PNB and Gitanjali Gems’ Auditors Issued Show-Cause Notice
Chartered accountants' apex body ICAI on Thrusday, 22 February, said it has issued show-cause notices to the auditors of Punjab National Bank and Gitanjali Gems in connection with the Rs 11,400 crore fraud at the public sector lender.
Besides, the institute has summoned a deputy general manager of the bank seeking details about the fraud.
Further, the ICAI has also written to the Reserve Bank of India requesting it to provide the list of the corporate borrowers of public sector banks having outstanding loan amount of Rs 2,000 crore and above.
The list would be examined by the Financial Reporting Review Board of ICAI for any possible violation of applicable standards of accounting as well as auditing.
4. 5,000 Aircel Staff to Hit Job Street
Aircel’s 5,000-odd employees are headed to the job market already clogged with former employees of telcos that have either pulled down shutters or are going through a merger, with their employers telling them to brace for “more difficult times ahead”.
Executive search firms, which have already received several resumes from Aircel employees, expect the number to shoot up post Aircel’s warning letter to its team members early this week.
“Where will they go? The market is already choking with former employees of other telcos,” said A Ramachandran, partner at search firm Ema Partners. “Operators are mostly on a hiring freeze, so there are very few spots where we can place a fresh batch of job seekers,” he said.
It’s not easy to find jobs in a sector that has lost more than one-fourth of its workforce, or over 75,000 employees, in the last one year as operators, tower firms and vendors have gone on a consolidation spree to stay afloat amid cut-throat competition triggered by Reliance Jio Infocomm’s entry in September 2016.
(Source: Economic Times)
5. Singh Brothers Say They Need Time to Resolve Issues
The Singh brothers, accused of financial irregularities at both companies promoted by them, Fortis Healthcare Ltd and Religare Enterprises Ltd, on Thursday, 22 February, said they needed time to resolve “complex” issues facing their family and businesses.
“We wish to say that given the circumstances and immense challenges facing us today, we assure all our stakeholders that we are doing whatever it takes to resolve the issues and will not shy away from our current responsibilities,” Malvinder Singh and Shivinder Singh said in a joint press statement.
The founders sought time from stakeholders to present facts that will allow for “balanced views”.
We assure that we are NOT going anywhere and are addressing the issues with responsibility and sincerity. We will not shy away from any and all processes,questions, clarifications that need to be addressed; and we will provide all cooperation to ensure that the truth comes forth.Malvinder Singh and Shivinder Singh’s statement
6. Kia to Hire 3,000 Employees for Its Upcoming Plant in Andhra Pradesh
South Korean auto maker Kia Motors Corporation on Thursday, 22 February, said it will soon start recruiting 3,000 employees to operate its upcoming plant in Andhra Pradesh.
The company, which is investing over $1 billion to set up its new manufacturing facility in India, held a framework installation ceremony at the unit.
The Kia plant, spread over 23 million square feet, will have a capacity to produce 3 lakh car annually and employ around 3,000 when fully operational.
The company is currently in discussions with the Andhra Pradesh government to start a joint training programme at the state government level to develop the necessary manufacturing skills among local residents, it added.
7. Uber Will Aggressively Invest in Southeast Asia: CEO
Uber Technologies Inc’s (UBER.UL) chief executive pledged to continue investing aggressively in Southeast Asia, even though the US ride hailing firm expects to lose money in the fast growing market due to costly battles with rivals such as Grab.
SoftBank’s 15 percent stake purchase in Uber last month has opened up the possibility of combining Uber with other ride-hailing assets the Japanese group owns across Asia. SoftBank has stakes in Singapore-based Grab and India’s Ola.
Dara Khosrowshahi said SoftBank is an investor but Uber, which has a valuation of around $68 billion, will take any final decisions along with the board on mergers and partnerships. He said he does not expect any change in Uber’s India operations following the deal with SoftBank.
India is one of Uber’s fastest-growing international markets and accounts for more than 10 percent of Uber’s trips globally, but it’s not making money yet, Khosrowshahi said.
8. Infosys Files Rs 100 Crore Claim Against Ex-CFO Rajiv Bansal
Infosys has slapped a counter-suit against former CFO Rajiv Bansal amounting to more than Rs 100 crore.
This is the latest in the developments after Bansal stepped down from the company in December 2015, where he expected to get two years of pay as severance amounting to Rs 17 crore.
Infosys paid only Rs 5 crore so far and held back the remaining payment, after the company's co-founder termed the compensation as "excessive" and implied the management may be paying it as "hush money.”
Bansal moved the courts to claim the remaining Rs 12 crore, but Infosys has sought a counter claim from him for Rs 100 crore, alleging a breach of trust and non-fulfillment of obligations.
9. Ikea India to Invest Rs 4,000 Crore in Maharashtra
Ikea India Pvt Ltd, the local subsidiary of Swedish furniture retailer Ikea of Sweden AB, plans to invest Rs 3,000-4,000 crore in Maharashtra to set up multi-format stores and experience centres, the company said on Thursday, 22 February.
The investment will be deployed over two-three years to build two large stores in Mumbai, a handful of experience centres and Ikea India’s first fully owned distribution centre in Pune, said Patrik Antoni, deputy country manager at Ikea.
A sum of Rs 750 crore out of the total investment has been set aside to develop the distribution centre.
“We are making some head-on investments when it comes to building the logistics because if we want to be affordable, we need efficient logistics infrastructure,” Antoni said, adding that the Pune centre will be a large hub connected to smaller distribution centres across India.
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