The race for Binani Cements is slowly inching closer to the finish line with Binani Industries on Friday submitting its revised out-of-court settlement plan along with a security deposit of Rs 750 crore in support of its proposal to the committee of creditors (CoC) of Binani Cement, sources close to the development told FE. This comes days ahead of a hearing on the resolution on April 9. The Kolkata bench of the National Company Law Tribunal (NCLT) had placed the responsibility of considering an out-of-tribunal settlement on the lenders of Binani Cement and had asked them to arrive at a decision by April 9. The CoC is expected to meet on Saturday to finalise its decision that will need to be conveyed to the tribunal on Monday, sources said. “Binani Industries has agreed to pay Rs 8,000 crore to the lenders. It has already made a security deposit payment of Rs 750 crore. It has placed the remaining amount in a separate account especially created for this purpose, and has shared details of the account with the CoC as a proof of its readiness to make the full payment within 10 days of acceptance of their proposal,” one of the sources quoted above said on condition of anonymity.
Another source indicated that the final proposal was for an amount of Rs 7,600 crore, but did not disclose if both accrued interest and the full amount demanded by operational creditors was included in this. FE could not independently verify the figures. Bankers said Binani Industries has agreed to pay the higher amount to clear dues of not just the lenders, but also of operational creditors and the interest due to the financial creditors. The revised plan is believed to include payment of legitimate dues of operational creditors, which these creditors claim stands at Rs 510 crore. It also includes another Rs 250 crore towards the interest accrued to financial creditors since the time the account was admitted by the NCLT for resolution under the Insolvency and Bankruptcy Code (IBC). In March, Binani Industries had reached an in-principle understanding with the Aditya Birla Group-controlled UltraTech Cement that would allow the latter to buy Binani Industries’ 98.43% stake in Binani Cement for Rs 7,266 crore provided the resolution process under the IBC is terminated. Since then, it has been trying to settle the matter outside the purview of the NCLT. FE was not able to get a confirmation on whether UltraTech had agreed to revise its offer in line with Binani Industries revised proposal for an out-of-tribunal settlement. A source close to UltraTech Cement told FE earlier in the week that UltraTech is unlikely to pay more than the initial Rs 7,266 crore that was agreed upon.
The source also said that only if Binani Industries can get the IBC proceeding terminated does its deal with UltraTech stand. However, bankers said that the lenders do not have the power to approve the out-of-tribunal settlement, and Binani will have to go to the appropriate authority, which is the Supreme Court. The creditors to Binani Cement include State Bank of India, IDBI Bank, Canara Bank, Bank of Baroda, Bank of India, Edelweiss Asset Reconstruction Company and others. On March 16, Dalmia Bharat had said the the resolution plan submitted by Dalmia Bharat-controlled Rajputana Properties was approved by the CoC. “The CoC of Binani Cement has recommended the resolution plan to the NCLT for its requisite approval,” Dalmia Bharat said in a statement, adding that the resolution plan has received almost 100% approval of the CoC members. Dalmia Bharat maintains that the resolution must happen as per the process laid out in the IBC. Binani Operational Creditors Forum (BOCF) spokesperson Siddharth Tibrewal said on Friday the resolution plan by Bharat Dalmia offers full payment to operational creditors with dues less than Rs 1 crore. For those whose dues are between Rs 1 crore and Rs 5 crore, the proposed settlement amount is 40%. For dues of Rs 5 crore to Rs 10 crore, it is 25% and for more than Rs 10 crore the settlement amount offered is 5%. In reality the outstanding is about Rs 510 crore, Tibrewal told FE.