Team SoOLEGAL

Binani Industries plea for scrapping of IBC process for Binani cement rejected by Supreme Court

Team SoOLEGAL 14 Apr 2018 9:08pm

Binani Industries plea for scrapping of IBC process for Binani cement rejected by Supreme Court

New Delhi: It seems the buying of debt laden Binani Cement will go down to wire. In the latest twist, the Supreme Court rejected plea for scrapping of Insolvency and Bankruptcy Code (IBC) process for Binani cement and asked it to approach NCLAT. Such a ruling puts Ultra-Tech at a disadvantage as it has made an outright bid to buy the company where as Dalmia Bharat led consortium becomes front runner as its bid of Rs 6,350 crore had come out ahead in the February auction held as part of the resolution process under Insolvency and Bankruptcy Code (IBC).

The top court, however, said it would hear another plea by a group of operational creditors that’s backing the Binani promoters’ higher offer on April 19.

There is intense competition for acquiring Binani Cement. On March 14 Dalmia Bharat's offer made through its subsidary Rajputana Properties for  Rs 6,350 crore covered 99.5% of the creditors and was accepted by committee of creditors. Whereas UltraTech revised its offer to Rs 7,266 crore with NCLT,Kolkata.

Where Dalmia Bharat was happy with the development and said sanctity of the due process of law has been restored, UltraTech refused to comment.

Binani counsel Harish Salve held there should not be any issue if a promoter is paying off the dues completely. There was no question of a settlement or a haircut that would be forced on lenders. “I don’t want any discounts,” he said, offering to ensure that the interests of all stakeholders would be taken care of. “The NCLT has the power to close the case,” he argued, if all debts were paid.

Under the IBC law promoters, related parties and connected persons can not participate in the bankruptcy process. However Abhishek Manu Singhvi who is representing UltraTech,  said  that the offer by UltraTech was an “open” one and not “surreptitious” and there is no role of promoters in it. Further the UltraTech offer is higher as compared to Dalmia Bharat.

The matter will come up for hearing on April 19.

Tagged: SC   NCLAT   UltraTech   Dalmia Bharat  
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