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Liberty House sole bidder yet again for ABG Shipyard

P Manoj Mumbai | Updated on April 23, 2018

SANJEEV-GUPTA-new

London-based metals group Liberty House has emerged the sole bidder yet again in a third round of bidding for ABG Shipyard Ltd when the deadline for submission of resolution plan for the debt-laden shipbuilder ended on Monday.

The bid submitted by Liberty House was accepted by the interim resolution professional (IRP) from BDO India LLP tasked with overseeing the process for ABG Shipyard, which is facing bankruptcy proceedings under the Insolvency and Bankruptcy Code (IBC), said a person briefed on the bid submitted by Liberty House.

Liberty House has cleared some $2.8 million it owed Exim Bank to become eligible to bid for the shipyard. Non-payment of the amount was cited by the committee of creditors to reject the bid, under Section 29 (a) of the IBC, submitted by the Liberty House on April 16 during an earlier round of bidding.

ABG Shipyard is among the list of 12 large companies that the RBI had identified in June 2017 for banks to refer to the bankruptcy court immediately.

The resolution of ABG Shipyard has to be completed by April 30, according to the time-line set by the National Company Law Tribunal (NCLT), which was set up to oversee the bankruptcy law aimed at fixing the country’s mounting bad bank loans.

The lenders have set a liquidation value of ₹2,200 crore for the yard that owes some ₹18,245 crore to a clutch of banks led by ICICI Bank.

BusinessLine could not ascertain the details of the resolution plan/bid submitted by the Liberty House led by Indian-born businessman Sanjeev Gupta, in the latest round of bidding.

The bid will be referred to the committee of creditors for a decision, the person mentioned earlier said.

Liberty House was the lone bidder in the first round of bidding, but its bid was rejected because it was below the liquidation value set by the creditors.

In the second round of bidding, Liberty raised the bid amount, offering ₹5,200 crore on a deferred payment basis stretching over five to 10 years for the yard. The bid also included an upfront amount of ₹400 crore and issue of debentures.

The business plan submitted by Liberty House in the previous rounds included completing the pending ship orders and then pursuing a combination of shipbuilding and ship-breaking business. It also included setting up a steel rolling mill inside the yard to make steel using materials generated from dismantling ships.

Published on April 23, 2018

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