Deccan Chronicle's VC arrested: A timeline of when trouble started for the media house
news Saturday, June 06, 2015 - 05:30
The Odisha police's arrest of P K Iyer, the vice-chairman of Deccan Chronicle Holdings Ltd (DCHL) from a hotel in Bhubaneswar can be proclaimed as just another incident in a long line of controversies that started around a decade ago. According to sources, Iyer, who was wanted by the CBI in connection with an alleged loan fraud to the tune of Rs 350 crore had been staying in the hotel under the name Chitra Athwani. The DCHL promoters are currently in trouble after the CBI has registered cheating cases against several top guns for availing multiple short term corporate loans by submitting false financial statements between 2008 and 2012. The issue was put on the spotlight after the CBI arrested T. Venkattram Reddy, the owner of the Hyderabad based newspaper, and his brother and Managing Director T. Vinayak Ravi Reddy, in relation to a Canara Bank fraud case on Feb 14, 2015. However, DC was not always owned by the Reddy brothers. 1938 - The paper was started as a weekly, by poet Sarojini Naidu's son, M N Jaisoorya along with three others, and was the first English paper that Hyderabad could call it's own. 1977 - The ownership of the paper exchanged hands to the Reddy family after debts piled up and the owners sold it to the late Chandrasekhar Reddy, who was Venkattram and Vinayak Ravi's father. Reddy went on to become a Congress MP and gave control of the newspaper to his sons 1993 - Venkattram Reddy takes over the paper after his father's death. The paper keeps growing and becomes the largest circulated paper in Hyderabad and also starts expanding to other states in the south challenging various well established papers like the Times of India and The Hindu. 2001 - P K Iyer joins the paper as the director of finance. He would remain a close aide of the Reddy brothers and would later be an equal partner in the company. 2005 - The loans started around this time with considerably small amounts so as to remain under the radar. Rs 20 crore from one bank and Rs 25 crore from another. These loan figures would soon escalate into 500 plus crore loans from various banks. 2007 - Each brother slices out a third of the shares they held in the company and "gifts" it to P K Iyer. The shares were worth Rs 1,170 crore and turned Iyer into an equal owner, overnight. 2008 - The company kept reaping profits and even bought the IPL team of 'Deccan Chargers' for a staggering 107 million dollars. The company's front looked like the expansion would never stop. However, on the back end, the loans were adding up. 2011 - DC reports first decline in profits and sales. In a bid to keep the cash flowing, it merges its subsidiaries namely, Deccan Sporting Ventures and Odyssey India with itself. This does not stop the share value from sliding down. 2012 - Players from Deccan Chargers allegedly get involved in spot fixing scandal and the BCCI terminates the franchise. The franchise was renamed Sunrisers Hyderabad after it was finally bought by Sun Network's Kalanithi Maran for Rs 85 crore. The Industrial Finance Corporation of India (IFCI) files a petition in the Andhra Pradesh High Court seeking the liquidation of Deccan Chronicle. Hyderabad-based financial firm Karvy Group also files a complaint against the promoters alleging forgery and misrepresentation. Six directors resign from the newspaper's board as the Reddy's indebtedness starts coming to light, making it the worst year and marking the downfall of the newspaper. 2013 - CBI files a case of cheating, fraud and criminal conspiracy against Deccan Chronicle Holdings chairman T. Venkattram Reddy, vice-chairman and managing director T. Vinayak Ravi Reddy , vice chairman P.K. Iyer as well as the company's auditors C.B. Mouli & Associates. The FIR accuses DHCL of taking corporate loans totalling Rs 1230 crore by allegedly submitting false and fabricated financial statements and by suppressing the borrowings taken from other banks. 2015 - CBI arrests Venkattram and Vinayak Ravi Reddy on February 14 claiming that evidence was found that that the DC promoters had "deliberately hatched a conspiracy" to cheat Canara Bank to the tune of Rs 1,230 crores. What was unusual about the loans were that the advances were not backed by enough security. The mortgaged assets were expected to fetch only a third of the loan exposure. Secondly, most of the lenders were unaware of the extent of leverage by the company and the exposure of other lenders to the group.