New Delhi, Jun 5 () Yes Bank on Friday clarified that it invoked pledged shares of direct-to-home (DTH) company Dish TV last month due to payment defaults by various Essel Group companies.
Yes Bank on May 29 announced that it has acquired 24.19 per cent stake (44,53,48,990 equity shares) in Dish TV India following invocation of pledged shares due to debt default by the DTH service provider and other group firms.
However on June 1, Dish TV issued a clarification via exchange filing stating that Yes Bank was incorrect in saying that it had acquired Dish TV shares on invocation of pledged shares subsequent to default/breach of terms of loans to the company.
"At the outset,...Dish TV India Ltd is not in default of any payment obligations to Yes Bank under the financing facility availed from Yes Bank," Dish TV said.
Yes Bank in a filing on Friday stated that its disclosure on May 29 clearly mentioned that the pledge has been invoked due to default/ breach by various Essel Group companies.
Clarifying about particulars in a section of May 29 filing that stated invocation of pledge subsequent to default/breach of terms of loan to Dish TV India, Yes Bank said it was an inadvertent mistake, rather it were Essel group companies that were in default of loans.
The DTH operator had also said that Yes Bank's statement that no government or regulatory approval was applicale for invocation of pledged shares was "factually incorrect".
Yes Bank replied that it was in compliance with the regulations (save and except the inadvertent error that acquisition of shares happened because of Dish TV's default of loans) and pursuant to exercise of rights granted to it under a valid contract.
Yes Bank shares closed 3.04 per cent up at Rs 28.80 apiece on BSE. Dish TV closed 4.83 per cent higher at Rs 4.83 apiece.
The lender said it would like to clarify that due to persistent breach and defaults by various Essel Group companies, the bank vide its letter dated July 24, 2019 had called upon the borrowers and World Crest Advisors LLP and Direct Media Distribution Ventures Private Limited (the Pledgors) to make payment of the outstanding amount due to the Bank.
Failing the payment, Yes Bank had said that it would be constrained to invoke the pledged shares (pledge created in favour of the security trustee for the benefit of the bank) and to sell the same to recover the outstanding amounts due to the bank.
"As the borrowers and pledgors have failed to repay the outstanding amount due to the bank, the bank was compelled to invoke the pledged shares on May 29, 2020," Yes Bank said. KPM MR MR
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