Bharat Dalmia awaits NCLT verdict even as UltraTech raises bid for Binani Cement

Suresh P. Iyengar | | Updated on: Dec 06, 2021

The consortium led by Bharat Dalmia Cement is confident of taking over the stressed assets of Binani Cement despite the rival Aditya Birla Group-owned UltraTech Cement raising its bid by ₹700 crore to ₹7,200 crore after the lenders announced the former as the highest winning bidder.

Interestingly, a day before revising its bid, UltraTech had moved the National Company Law Tribunal stating lack of transparency in the selection of the highest bidder for Binani asset.

“Lenders have issued a letter declaring Bharat Dalmia Cement consortium as the highest bidder and rejected UltraTech bid. Now whatever price UltraTech is willing to pay is immaterial and does not have any value,” said a source tracking the developments.

If Bharat Dalmia Cement’s bid is endorsed by NCLT, it will be its third acquisition of a bankrupt company, after Murli Cement and Kalyanpur Cement. It is surprising that UltraTech is claiming that there was no transparency in bidding as the score sheet based on eligibility was displayed on the Web site in advance and some of the bidders had even raised questions on it, said an executive of a cement company which was part of the auction which was conducted under the watchful eyes of the Central Vigilance Commission.

The outcome of the Binani Cement case will be watched keenly not only by interested parties but also by global companies as the NPA-laden banking sector tries to attract foreign investors in future auctions. Lenders are in the process of monetising defaulting companies assets to recover over ₹3-lakh crore of bad debt through the NCLT-driven process.

Binani Cement was dragged to NCLT by Bank of Baroda after it defaulted on ₹410-crore loan.

Edelweiss ARC has the largest exposure with ₹2,673 crore followed by Bank of Baroda with ₹410 crore besides State Bank of India (₹323 crore) and Canara Bank (₹320 crore). Unsecured lenders include IDBI Bank (₹1,567 crore), Exim Bank (₹617 crore) and Bank of Baroda’s London branch (₹175 crore).

Published on March 11, 2018
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