Hospitality firm Oyo on Monday has dismissed allegations made by the Federation of Hotel & Restaurant Associations of India (FHRAI) to Sebi, in which the association had called for the suspension of the company's proposed IPO citing alleged anti-competitive practices, fraud, and inadequate disclosures in DRHP.
Meanwhile, FHRAI has also filed a fresh civil appeal against the NCLAT's July order in which it had closed an insolvency case against an Oyo subsidiary. FHRAI had approached Sebi in October asking the regulator to reject Oyo's DRHP and suspend the proposed IPO.
In a response to FHRAI's letter to Sebi, which Oyo sent to both FHRAI and Sebi, the company said it is not involved in anti-competitive agreements as alleged. The company also said it is not in a dominant position and hence cannot abuse its position, citing a 2019 CCI order.
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On allegations that Oyo has avoided contractual obligations with hotel partners by invoking force majeure, the company said it was "constrained" to invoke force majeure provisions due to pandemic, and that no fraud was committed.
FHRAI had also alleged that the company had not made adequate disclosures of outstanding litigations against them in the DRHP and that it would impact retail investors.
Oyo, however, has said all outstanding litigation against the company has been disclosed in the DRHP. Oyo had filed its DRHP with Sebi on October 1 for raising Rs 8,430 crore through an IPO. It is still to receive the regulator's approval.
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Oyo did not respond to queries. FHRAI said it "rejects "Oyo's response and added that Oyo must resolve issues of hoteliers and claimants. "FHRAI will wait for Sebi's decision," the association said in a statement. FHRAI files a civil appeal against the NCLAT order on the Oyo subsidiary insolvency case.
In a separate matter, the FHRAI filed a civil appeal against the NCLAT order in which it had given relief to Oyo from an insolvency proceeding against a subsidiary. The matter will be heard in the Supreme Court on Dec 15.
NCLT Ahmedabad in April had launched IBC proceedings against Oyo subsidiary over payment default. However, the NCLAT had closed the insolvency process against the company in July.
Following that, a Siliguri-based hotel owner challenged NCLAT’s decision in the Supreme Court, and FHRAI also filed applications to intervene in the case.
(Edited by : Jomy Jos Pullokaran)
First Published: Nov 29, 2021 5:43 PM IST
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