IL&FS Group sells education arm to FTPL, reduces debt by Rs650 cr
The IL&FS Group on Wednesday completed sale of its 73.69% stake in Education business, held under the Schoolnet India Limited (SIL), to Falafal Technologies Private Limited (FTPL).
 
The sale was completed pursuant to the approval granted by the National Company Law Tribunal (NCLT), Principal Bench through an order dated 31 August 2020. The transaction provides positive equity value to IL&FS and resolves nearly Rs 650 crore of consolidated fund based and non-fund based financial debt, without any haircut to lenders.
 
FTPL has paid Rs7.37 crore as equity value for shares of Schoolnet India Limited (SIL) held by IL&FS Limited and IL&FS Employee Welfare Trust, in addition to taking over SIL's fund based and non-fund based financial debt of nearly Rs650 crores.
 
Further, FTPL has also agreed to a deferred consideration of Rs6.29 crore payable within 18 months from closure.
 
FTPL is a subsidiary of Lexington Equity Holdings Ltd (LEHL). LEHL already holds a 26.13% stake in Schoolnet India.
 
Sale of SIL will reduce operating cost for the IL&FS Group by nearly 19%. IL&FS Group holds 73.69% stake in SIL. SIL holds 80% stake in IL&FS Skill Development Corporation (ISDC) and also has two wholly owned subsidiaries, IL&FS Cluster Development Initiative Limited (ICDI) and Skill Training Assessment Management Partners Limited (STAMP).
 
As part of the sale transaction, the businesses of ICDI and STAMP have also been transferred to SIL through a slump sale for a consideration of Re 1 for each company. Transfer of debt of nearly Rs27 crore in ICDI and STAMP forms part of the slump sale.
 
Further, the shares of ICDI and STAMP have been transferred to IL&FS Limited. SIL will continue to retain 80.01 per cent in ISDC which will become a step down subsidiary of FTPL. This development represents another key milestone in the overall resolution for the IL&FS Group under the New Board.
 
As part of the overall resolution plan to address a significant portion of the Group's debt, the sale of a number of other Group assets has been initiated which is currently in various stages of progress.
 
SIL provides Ed-tech services to K-12 schools and students through proprietary digital content, devices, platforms and solutions. ISDC offers job linked vocational programmes for the youth. ICDI provides advisory and management services to the Central government, state governments and Industries for development of common infrastructure and facilities in Brownfield and Greenfield industrial clusters.
 
STAMP provides assessment solutions on a lifecycle approach to students, youth (job seekers) and working professionals.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Norway’s Central Bank Excludes Jockey Page Industries from Investment by GPFG, the World's Largest Sovereign Wealth Fund, for Human Rights Abuses
    Norges Bank, the central bank of Norway, has decided to exclude India-based Page Industries Ltd from investment by the Government Pension Fund Global (GPFG), the world's largest sovereign wealth fund. This decision is an outcome of a recommendation by the Council on Ethics of GPFG to exclude from investment Page Industries due to an 'unacceptable risk that the company is responsible for systematic human rights abuses'. 
     
    The Council, in its report had stated, "Investigations into working conditions at one of the company’s factories identified numerous labour rights violations, including verbal and physical harassment of employees and occupational health and safety hazards. The company also seems to restrict employees’ rights to organise."
     
    The Council emphasised that Page Industries has not provided any information to help clarify the case or how it works to prevent norm violations at its facilities. In practice, it seems as though the company does little to prevent the abuse of labour rights in its operations. 
     
    Post the recommendations, Norges Bank decided to exclude from investment Page Industries, the exclusive licensee of JOCKEY International Inc for manufacture, distribution and marketing of the JOCKEY brand in India, Sri Lanka, Bangladesh, Nepal, Oman, Qatar, Maldives, Bhutan and the UAE.
     
    Established in 1990 to invest the surplus revenues of the Norwegian petroleum sector, GPFG has over $1 trillion in assets, including 1.4% of global stocks and shares, making it the world’s largest sovereign wealth fund.
     
    The Council on Ethics says it assessed the risk that Page Industries is contributing to or is itself responsible for systematic abuses of internationally recognised human and labour rights. The Council defines 'systematic' as abuses that do not appear to be isolated incidents, but rather constitute a pattern of behaviour. In its assessment of the future risk of human rights abuses, the Council says it attaches important to what the company has done to prevent norm violations occurring again.
     
    The report from the Council on Ethics, says, "The Council has based its assessment on its own investigations into the company’s garment factory Page Unit 3 in Bangalore in India. 
     
    "The Council attaches importance to the employees’ reports of humiliating verbal and physical punishments when employees return from lawful holiday or sick leave, fail to meet their production targets or make production errors, and the fact that this seems to be a well-entrenched practice among managers at the factory. This must also be seen in in light of the fact that the workers themselves seem to be obliged to bear responsibility for reaching the production targets even when production is halted for reasons that are neither their fault nor within their power to control."
     
    "An aggravating factor is that the harassment is directed at subordinate employees, who are unable to defend themselves without being punished for it and must, therefore, be classed as vulnerable. The Council also attaches importance to what seem to be violations of national regulations relating to fire safety, personal protective equipment, electrical hazards and equipment maintenance, and indoor air quality that may pose a hazard to health. In the Council’s opinion, the company’s practices constitute a violation of the right to safe and healthy working conditions, including the right to freedom from harassment," the report says.
     
    According to the Council, Page Industries has failed to help clarify the case or give it the permission to inspect the factory. It says, "...the company explained this refusal by saying it could not permit an inspection due to its agreement with the licence issuer. This proved not to be correct. Page Industries has further failed to comment on the draft recommendation to exclude it from investment by the GPFG. In consequence, the Council has had access to less information in this case than in other similar cases it has assessed. The information deficit applies to both the scale of the norm violations and what the company is doing to prevent norm violations." 
     
    In keeping with Report No. 20 (2008-2009) to the Norwegian parliament (Storting), the Council says it "takes the view that a lack of information about a company’s behaviour and, not least, a lack of willingness on the part of the company to provide information, may, in and of itself, add to the risk of contributing to unethical behaviour being deemed unacceptably high."
     
    "In the Council’s opinion, it seems as though Page Industries does little to prevent the abuse of labour rights in its operations. The Council considers that the company does not in practice have a system capable of preventing, uncovering or remedying labour rights abuses in its operations. When the company furthermore fails to provide information about the matters in question or measures to safeguard acceptable working conditions, the risk of systematic labour rights violations becomes, in the Council’s view, unacceptable," the recommendation report says.
     
    According to a report from Economic Times, following recommendation from the Council, Page Industries' partner Speedo International said it would investigate the report. As per a Reuters report, the company manufactures Speedo products in only one Indian factory. Page Industries denied the allegations and said the report does not reflect the correct state of affairs of the units of the company, the newspaper says. 
     
    We sent an email to Page Industries. However, till writing this story, we have not received any reply from them. We will update this story as and when we receive any reply from Page Industries. 
     
    After hitting a 52-week high at Rs26,891 on 24 January 2020, and a low of Rs16,186 on 24 March 2020, Page Industries' shares are on a roller-coaster ride. It has not been able to participate in the rally that took place post-COVID-19 crash.
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    COMMENTS

    cns

    3 months ago

    It is important for all corporates to adhere to or gradually align to the SDG's as announced by the UN. I believe, only Socially Responsible Companies will command a premium amongst investors as business needs to have a positive social IMPACT

    REPLY

    s5rwav

    In Reply to cns 3 months ago

    SDGs Highly Crucial for Humanity.

    Saket Jain

    3 months ago

    Is this decision based on 2008-9 report as provided in article?

    sheoratan

    3 months ago

    This is only Tip of Iceberg;All Textile cos use forced/bonded Labor and despite ILO reports, evidences,no action is taken.Ive proofs....can somebody take the activist role? I can be reached at my mobile 7822089800.The MODERN SLAVERY........

    REPLY

    s5rwav

    In Reply to sheoratan 3 months ago

    Please See Whatsapp Message from me. I am Babubhai Vaghela from Ahmedabad. Thanks.

    s5rwav

    3 months ago

    Dear #NSEIndia: Why Allow Human Rights Violators #BoardOfDirectors of Indian Oil Corporation Limited Headed by Mr #SMVaidya as the Chairman of Indian Oil Corporation Limited to Trade on NSE? I am Babubhai Vaghela from Ahmedabad. Thanks.

    India's 2020 auto sales expected to decline by 30%: Moody's
    India's auto sector is expected to face challenges this year, with the country's economy predicted to contract in 2020 amid the pandemic, Moody's Investors Service said on Tuesday.
     
    According to it, auto unit sales will decline at least 30 per cent in 2020, following a decline of over 40 per cent in the seven months through July.
     
    "The lower annual decline reflects our expectation of a pickup in economic activity during the remainder of 2020, which also includes the festive period - October through December," the Moody's Investors Service said in a report.
     
    "A second wave of infections and extension of lockdowns cast a shadow of risk on these forecasts. Also, tighter lending criteria could limit liquidity available for consumers and auto dealers."
     
    As per the report, looking ahead, unit sales will likely grow around 20 per cent in 2021, though clearly on a lower base.
     
    "Moreover it will take at least another four years for India's unit sales to recover to pre-pandemic levels," the report said.
     
    On the other hand, the global automotive industry's outlook has been changed to stable from negative.
     
    "The stable outlook for the global automotive industry reflects rising sales through 2021, with continued, but slow, increases through 2023," said Bruce Clark, Moody's Senior Vice President.
     
    "Nevertheless, auto shipments won't recover to pre-pandemic levels until the middle of the decade."
     
    The coronavirus-driven downturn in unit sales is significantly worse than the 2009 decline, Clark said.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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