UltraTech Cement on Monday filed an application before the National Company Law Appellate Tribunal (NCLAT), seeking its direction to the resolution professional (RP) of Binani Cement to call a committee of creditors (CoC) meet in order to consider its revised bid for the insolvent cement maker.
UltraTech Cement on Monday filed an application before the National Company Law Appellate Tribunal (NCLAT), seeking its direction to the resolution professional (RP) of Binani Cement to call a committee of creditors (CoC) meet in order to consider its revised bid for the insolvent cement maker. The Kolkata bench of the National Company Law Tribunal (NCLT) had passed an order on May 2, asking RP Vijaykumar V Iyer and the CoC to consider the revised offer of around `7,900 crore from UltraTech Cement.
Iyer, however, had cancelled the lenders’ meet scheduled for May 10 after rival bidder Dalmia Bharat in a letter to him raised the issue of UltraTech’s ineligibility under Section 29A of the Insolvency and Banruptcy Code (IBC). In the letter sent to the RP and CoC, Dalmia Bharat had raised objections to UltraTech’s bid, alleging that the latter had become ineligible to participate in the auction after acting in concert with Binani Industries, promoter of Binani Cement, to exit the insolvency process.
In a letter to the members of the CoC on May 9, the RP said, “I have received objections from Rajputana Properties (the subsidiary firm of Dalmia Bharat) in relation to eligibility of UltraTech Cement under Section 29A of the Insolvency and Bankruptcy Code, 2016, to be a resolution applicant of Binani Cement (corporate debtor).”
Iyer, in the letter, said in view of the objections raised and to make an “independent, careful, fair and reasoned determination”, he was informing the CoC members that the meeting scheduled on May 10 in Mumbai “stands cancelled”.
Talking to FE, Atul Daga, chief financial officer, UltraTech Cement, after the cancellation of the lenders’ meet, had said, “The letter which Dalmia Bharat has written to the RP is baseless, there is no violation of Section 29A of IBC. They are trying to do a last minute attempt to do something to delay the process, because they are not able to match our bid.”
While the Kolkata bench of the NCLT had allowed UltraTech’s revised bid to be considered, it had also offered the Dalmia Bharat-controlled Rajputana Properties a chance to better its offer of `6,930 crore. This bid, which includes an infusion of working capital and capex, had been declared the highest bid (H1) on February 27.
UltraTech Cement had improved its offer to around `7,900 crore, after submitting an earlier revised bid of over `7,200 crore to the RP on March 8. UltraTech had claimed that negative points had been wrongly assigned to its bid, making it the H2 and not H1 bidder.
Notably, the Supreme Court on last Thursday had rejected Dalmia Bharat’s plea seeking a stay on the NCLAT May 4 order, which allowed the RP and the CoC to consider the bid of UltraTech Cement.
The NCLAT’s interim order had stated that during the pendency of Dalmia Bharat’s appeal, the CoC can approve any plan it deems fit but that will be subject to its final decision. Dismissing Dalmia Bharat’s plea, a bench led by justice Rohinton Nariman of the apex court had requested the NCLAT to decide Dalmia Bharat’s petition expeditiously on a day-to-day basis. The NCLAT is slated to hear the matter on May 22.