My response to the Business World Article posted on my LinkedIn Profile 2 years ago...
(pardon my grammar or language errors as I have typed this in speed)
Dear All -There was an article in Business World authored by Mr. Anurag Batra Editor-in-Chief of Business World disparagingly commenting about me with such low words that he poo-poohed my bid for Air India as he doubted if I could afford even travel by Economy Class. His office colleague forwarded the Business World Article to my whatsapp that mainly alleges that
(a) I am carrying dubious reputation and one NBFC has rightly titled this for me (I have never interacted with any NBFC as of today)
(b) that certain founders (of Township, Hotel, Airline (One small and One big) fell a prey of my tall claims (I am not sure why we spend millions on their companies due diligence if we for fun and maverick reasons we post acquiring companies).
I am henceforth presenting facts against the matters inappropriately written damaging our reputation that Mr. Batra and his Journal attempted.
I always appreciate fair journalism but if it’s written without factual then it harms the integrity and survival of the person who is genuine.
I shall be explaining each of the issues cited and on his comments that he is surprised that I have bid for air India when he has even doubted my capability that I could buy economy airfare of air India.
It doesn’t call for fair journalism when things are written unfairly. And I deserve a fair presentation of facts.
What I was in 30 years I have openly presented myself in LinkedIn earlier including any citations pointed out before. I am presenting my response here as I seriously protest fake journalism written with personal vengeance. Ms Tanvie, Business World Associate termed my response to her as written in agitation. It is not. I am responding because, I keep my record clean and It’s that whoever does something wrong should be brought to books.
Transaction Refusal: As a person representing thousands of investors, we do intend to invest but into right kind of assets. But we are very cautious in making our investment decisions. After-all it is not my money but the hard savings of salaried class investors whom we represent.
It’s a fact that after 25 years of hard work I have come back to invest into India and contribute my best for this country but that doesn’t mean that I should throw hard earned money of investors into the drains of some defaulting promoters who lost public money taken from banks and made investors gullible. Its obvious being a CA and CPA, I am very cautious and careful. Unfortunately, Promoters carry garlands if you invest and throw shit on us if we refuse. This is exactly what Anurag attempted.
He is is no different and his article written now even stoops down his fair journalism in the guise of representing some promoters who made banks and public loose heavily for their luxury. Ya it is true we do not move in charter flights, I still travel in economy class and not cost my clients because I have come in life from modest grassroots.
Before I write further, I would like to note to the readers that we have not charged any dime from any of these prospects we judged to acquire - Rather it costed us millions of dollars to conduct and due diligence and investigate our prospective investees -- we bluntly refuse if we do not find them appropriate.
Now the case facts --
(a) Mr Batra's own firm - 80% of Business World Capital was invested by the family office of Yes Bank Original Founder who is now jailed). And Media & Newsprint FDI cannot exceed 26% but despite this fact, I was willing to invest. We advised that we can take AIF route for the balance of investment. We signed term-sheet but his office suggested they were waiting for clearance from the Family Office of Rana Kapoor which they never turned back. I have not received response from Business world. Then one-day I was taken to the office of Business World which made us investigate into their financials thoroughly for a second opinion and we choiced not to risk our retirement asset client money.
Hotel Transaction — We entered into a Binding agreement with a 5 Start deluxe property Group on their Chennai Property and the transaction was for ?700 Cr. However in due diligence we found that it costed 1450 Cr to build the hotel but due to low occupancy rate, the asset was written down by 450 Cr to Rs 900 Cr. On the top we further bargained the price down to Rs 700 Cr. We were cautioned by a senior CBDT member and an ex-principal chief commissioner of Income Tax that when assets are largely written off and we purchase the assets as a slump sale then we should obtain ruling from cbdt through Supreme Court or it will be considered by the department as a sham transaction risking freeze of monies at both ends. As this was the issue, I suggested that hotel founder that we rather invest into Group as substantial acquisition and then de-merge each of the hotel assets as separately listed public companies. Then Founder advised me to put the offer price at Rs 2,100 which the ARC refused. We have additionally increased the offer to 2,600 plus crores but that also did not invoke any favorable response from the ARC. I have infact referred the asset to a delhi based investor which the founders visited in Delhi but the terms were not acceptable. Later the investor extended the price offer that was exactly matching our recommendation. Anurag further claimed that the founders lost by hosting my stay luxuriously. But the whole of my stay at the hotel was paid by our company and nothing was taken on credit not even for a single time. By US Laws, we cannot take gifts from clients.
Mr. Batra allegation about AirIndia-
In air India we supported employees and submitted enough financial evidence to support but the bid was unsuccessfully participated by employees group. As per Mr. Batra, I may be consciously traveling by economy because of the modest life and roots we grew up with and he may be traveling by charters or business class, but we are self made entrepreneurs having value for money. including Infosys Mr. Narayan Murthy and Wipro chairman people like us commute by economy fare and do not waste our money in luxury spending. We spend what is required for business. Wealth is not measured by our show off but how we value the wealth of the people who believe in us and extend it to us.
Pavan Ruia of Dunlop fame: He met me once in ITC Maurya on Air India through a common friend but after performing internal due diligence, we remained silent. I never met Pavan Ruia after then.
On Lavasa, we were extremely interested in acquiring this asset and in fact even submitted our biding offer in the amount of 1,440 cr detailing schedule of our investment. However the issue was on EMD. We were not comfortable with the terms of the EMD - Though on the face of EMD appears refundable, those terms are at the mercy of the Creditors Committee. We hence backed off after 4 years of rigorous pursuance on Lavasa.
On Trujet, the airline was bleeding with 450 Cr losses. It cannot be dealt with an open bucket to loose money but implement very tough financial overhauling.. As we found many irregularities we turned silent.
What is factual and what is written out of vengeance and who deserves a freeze, I am a very open book easily accessible and as a citizen of India I am responsible to answer the law and equally expect the law to offer fairness to me against all wrongful journalism.. Substantial Equity of Business World was held by a family group whose founder went to Jail because of his fraudulence with the bank he founded. And cash struggling magazine talked about our travel in economy class (what a poor mindset) and his vengeful write up is believed by another sick mind here complaining on a person and the group that maintains communication with its stakeholders on a minute to minute developmental progress. This ladder pulling sickness is what kills the entrepreneurship and I just pity some minds...
Laxmi Prasad
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