Binani Cement’s committee of creditors (CoC) on Monday voted in absolute majority in favour of the revised resolution plan submitted by the Aditya Birla Group-controlled UltraTech Cement which has offered to pay Rs 7,960 crore. Under this plan, all the financial as well as the operational creditors will receive their complete dues.
The resolution plan will now be sent to the National Company Law Tribunal (NCLT) for its approval as per the Insolvency and Bankruptcy Code (IBC) process. After the NCLT’s approval, the plan will need to be approved by the National Company Law Appellate Tribunal (NCLAT). The stance of the Supreme Court also needs to be seen as on Monday it agreed to hear next week the petition of rival bidder Dalmia Bharat, which wants that UltraTech’s bid not be considered at all.
The NCLAT has been hearing multiple petitions filed by both UltraTech Cement and Dalmia Bharat. It is scheduled to hear the matter again on July 10. In the interim, it asked the resolution professional (RP) Vijaykumar V Iyer to continue with the resolution process, but said that the final outcome will be subject to its order.
“The creditors have voted for UltraTech Cement with a 100 per cent majority. UltraTech Cement has agreed to pay Rs 7,960 crore, which includes Rs 300 crore towards working capital of Binani Cement,” a senior banker who was part of the nine-hour-long CoC meeting, said. A spokesperson for UltraTech Cement did not comment on the matter. On the other hand, Dalmia Bharat will wait for the NCLAT’s decision on this matter. Sources close to the development said the company would approach the Supreme Court if the NCLAT’s decision was not in its favour.
Binani Cement owes around Rs 6,500 crore to its financial creditors, according to claims admitted by the National Company Law Tribunal (NCLT). It owes around Rs 600 crore to its operational creditors.
The RP and the CoC decided to go ahead with the CoC meeting on Monday despite Dalmia Bharat writing a letter to them on Sunday urging them not to proceed until the Supreme Court’s decision on this matter was available. In its petition in front of the apex court on Friday, Dalmia arm Rajputana Properties challenged the NCLAT’s May 15 order, where the appellate tribunal had directed the RP not to decide on the eligibility of the bidders but to pass on the resolution plans in sealed covers to the CoC. On Monday, Rajputana Properties’ petition was mentioned before a bench of the Supreme Court by its counsel for early hearing. The apex court is scheduled to hear the case on June 4.
Earlier this month, the CoC gave the option to Dalmia Bharat to match UltraTech’s bid by May 23, but Dalmia Bharat decided to stick to its original offer of around Rs 6,500 crore. Also, Binani Industries, which holds a 98.4 per cent stake in Binani Cement, had moved the NCLAT offering to clear all dues of all creditors within two weeks if Binani Cement was brought out of the purview of the corporate insolvency resolution process.
This is the second time Binani Industries has attempted to bring Binani Cement out of the purview of the IBC. FE