Chennai : In another case of the surety falling pray for the mistake of defaulter, Latha Rajinikanth’s surety to MediaOne Global Entertainment for a loan of 22 Crores from Exim Bank seems to costing her the 2.13 acre land near Chennai, as Mediaone is not in a position to pay back the loan neither in near future nor in a convincing manner (schedules) to the banker.
The Export Import Bank of India has taken possession of a two-acre property belonging to Latha Rajinikanth, wife of ‘superstar’ Rajinikanth, as compensation for a ₹20-crore loan that was not repaid by Mediaone.
The bank earlier issued a public notice saying it has taken possession of a 2.13-acre land parcel at Sriperumbadur taluk in Kanchipuram district, pledged with it by Latha Rajinikanth as a guarantor for MediaOne Global Entertainment Ltd.
Mediaone Global, which produced the superstar’s animation film Kochadaiiyaan, directed by his daughter Soundarya Ashwin, borrowed ₹20 crore from the bank, for the film.
As the production house failed to repay the loan of ₹22.22 crore (with interest and other charges) within the agreed time frame, Exim Bank has taken possession of the property under the Securitisation & Reconstruction of Financial Assets and Enforcement of Security Interest Act, and put it up for sale.
J Samuel Joseph, Chief General Manager, Exim Bank, told that the bank could not stop the process just because the individual involved is a VIP.
Dr Murali Manohar, Director, Mediaone Global, said the company is in talks with the bank and had said that it would repay the loan with interest on or before March 31, 2015. While the principal borrower (Mediaone) is at the negotiating table with the bank, there is hardly any need for such a notice, he said.
A press release from the company said, “The act of Exim Bank to call upon the guarantors Latha Rajinikanth and CR Devender to repay the loan, when the principal borrower is making arrangements to repay, is not warranted.”
However, Joseph from Exim Bank responded that “Mediaone people have been saying this long since that they would settle, but we are not confident that it will happen. So, we just went ahead and took symbolic possession of that property, and we will sell it the moment we find a buyer. We cannot afford to differentiate between a common man and a high-profile individual.”
He added that the bank is not willing to give the borrower any grace period to settle the loan. “We have already initiated the legal process to sell the property. If they are able to settle before the formalities get over, we will give the property back to the guarantor.”
Made with a huge budget of over ₹100 crore, Kochadaiiyaan fared poorly at the box office. However, Manohar said it will take at least another year for the company to say whether the movie has failed at the box office “as receivables from overseas distributors are yet to come”. Overall, Mediaone borrowed ₹38 crore — ₹20 crore from Exim Bank and ₹18 crore from Oriental Bank of Commerce.
While the bankers are not convinced with the mere assurance from Mediaone, they expect the Company to reciprocate with some part payment immediately followed by a convincing repayment schedule. whereas, the current financial strength of Mediaone is not allowing them to assure anything of that sort and making things in worse. Going by the current phase of proceedings by the lender Exim Bank, it seems Latha Rajinikanth’s property going under hammer is inevitable.