SS Kothari Mehta to audit Lilliput accounts

The Delhi High Court has appointed SS Kothari to independently

audit and investigate Lilliput Kidswear accounts. PE investors Bain Capital and TPG had demanded a forensic investigation of Lilliput books but the court dismissed the plea. The court has also asked both Lilliput and PE investors to provide point of references to help S S Kothari Mehta and company to carry out the audit.

In an earlier development, through an interim order, the court restrained the PE players from selling their shares in the kidswear retailer without first offering them to Lilliput promoter Sanjeev Narula. It had also asked both the parties involved to suggest 3-4 names each for the appointment of an independent auditor.

Bain Capital and TPG, together had invested $86 million to acquire a 45 per cent stake in Lilliput Kidswear April last year but withdrew their support for the company’s initial public offering in late September, saying they have doubts over the genuineness of company’s books and accused Narula, who owns 55 per cent stake in the company, of fudging company accounts. Narula in turn moved the court early last month, alleging that the investors were trying to stall the company’s initial public offering to seize majority control.