Debt-ridden Wockhardt Hospitals today reached a settlement with Development Bank of Singapore. DBS, represented by JurisCorp, had filed a winding-up petition against Wockhardt in the Bombay High Court last month. DBS's petition is the first of several winding up petitions that have been filed with the Bombay High Court by Wockhardt's aggrieved creditors. Barclays Capital and Calyon, also represented by JurisCorp, as well as FCCB holder Bank of New York Mellon Corporate Trustee Services (BNY), advised by DSK Legal, have all filed separate petitions in the Bombay High Court seeking to liquidate the company, which has engaged Majmudar & Co. to brief its High Court counsels.
Debt-ridden Wockhardt Hospitals today reached a settlement with Development Bank of Singapore. DBS, Singapore's largest bank, had filed a winding-up petition against Wockhardt in the Bombay High Court last month, after the healthcare company failed to respond to notices against its Corporate Debt Restructuring (CDR). Wockhardt Hospitals, which owes more than Rs. 3,700 Crore ($799 million), is in the process of a debt restructuring, but the CDR has been opposed by its foreign creditors. DBS and Wockhardt today filed a consent decree before the Bench comprising Justice D.Y. Chandrachud to agree to settle the matter outside the court.
DBS's petition is the first of several winding up petitions that have been filed with the Bombay High Court by Wockhardt's aggrieved creditors. Barclays Capital and Calyon, the investment banking arm of Credit Agricole, as well as FCCB holder Bank of New York Mellon Corporate Trustee Services (BNY), have all filed separate petitions in the Bombay High Court seeking to liquidate the company. However, all the matters will be clubbed, and the settlement process may be expanded to include all parties that have filed winding-up petitions against Wockhardt, opines a source connected to the issue.
Wockhardt is being represented by Senior Counsels Rafique Dada and Rohit Kapadia, on instructions from Majmudar & Co. Juriscorp is advising Calyon and Barclays, in addition to DBS, which is being represented in the High Court by Senior Counsel Iqbal Chagla. JurisCorp Partner Huzefa Nasikwala is acting as briefing counsel for DBS.
Senior Counsel Janak Dwarkadas is appearing for BNY and is briefed by DSK Legal's Litigation Partner, Gopika Pant. ICICI, one of the sponsors of the CDR scheme, has also filed an application in the matter, and is being represented by Senior Counsels Virag Tulzapurkar who is being instructed by the Managing Partner of Singhi & Co., Sandeep Singhi. Kotak Mahindra Bank and Corporation Bank, the other domestic lenders behind the CDR scheme, are also in the fray, with Vimadal & Co. appearing on behalf of Kotak and Ratna Marghavan appearing for Corporation Bank.
Wockhardt's CDR package has been a bone of contention for its foreign creditors who accuse ICICI Bank of framing a CDR that is more beneficial to domestic lenders. Ever since its IPO failed last year, Wockhardt has been in severe financial trouble. Divesting its stake in several of its subsidiaries was one of the strategies adopted by Wockhardt as part of the debt restructuring process. In August this year, it sold 10 hospitals to Fortis Healthcare for Rs. 909 Crores ($186 million). Vaish Associates acted for Fortis in this transaction. Wockhardt was advised by Amarchand Mangaldas, who also advised on the sale of its nutritional business to Abbott Laboratories for Rs. 627 Crores ($130 Million) and its animal health division to French company Vetoquinol for approximately Rs. 170 Crores ($ 36 Million). Wockhardt recently sold their German subsidiary, Esparma for Rs. 120 Crore ($ 25.8 Million).
Rajendra Shah, who is the Senior Partner at Crawford Bayley & Co., is on the board of directors of Wockhardt. However the firm is not appearing in any of the winding up matters pending before the Bombay High.
All Firms involved in the dispute declined to comment when contacted, on the grounds that the matter was sub-judice.