Ending months of uncertainty, the National Company Law and Appellate Tribunal (NCLAT) on Thursday approved UltraTech Cement bid of ₹7,900 crore for stressed Binani Cement rejecting the offer of ₹6,930 crore by Dalmia Bharat-Bain Piramal consortium Rajputana Properties, though it was declared as highest bidder by the Committee of Creditors earlier.
In a 44-page order, justices SJ Mukhopadhaya, Chairperson, and Bansi Lal Bhat, Member, NCLAT, said the revised resolution plan submitted by Ultratech Cement approved by the Committee of Creditors meets the requirements and the plan shall be binding on the corporate debtor and its employees, members, creditors, guarantors and other stakeholders involved in the resolution plan.
The Appellate Tribunal also directed the adjudicating authority to constitute a monitoring committee to implement the revised approved plan of Ultratech Cement in accordance with law.
Binani Cement is a subsidiary of Binani Industries with a stake of 98.43 per cent. It owed over ₹6,000 crore and was admitted into the Kolkata bench of NCLT for insolvency and bankruptcy process last year. Two companies emerged as top bidders — Rajputana Properties and Ultratech Cement.
Initially, the Aditya Birla Group company UltraTech Cement had placed a bid of ₹6,500 crore for Binani Cement, much lower than that of the Dalmia Bharat Cement. After Dalmia Bharat Cement was announced the highest bidder, UltraTech revised its offer by ₹700 crore to ₹7,200 crore and further to ₹7,840 crore, thus covering the entire debt and interest of all the debtors.
Dalmia Bharat Cement did not revise its offer even after getting an opportunity from CoC. Finally, the CoC approved UltraTech as the highest bidder and submitted the plan to NCLT for approval.
In July, hearing a petition filed by Dalmia Bharat, the Supreme Court had transferred multiple cases relating to corporate insolvency of Binani Cement to the NCLAT from National Company Law Tribunal, Kolkata, for fast tracking the process.
NCLAT judgement said the CoC consisting of the financial creditors encumbered with public money ought to act in the interest of maximisation of asset value. As per IBC, the CoC has the discretionary power to take the best decision, within the stipulated timeframe, to best suit the interests of the creditors and the public money involved in the process, it said.
Dhaval Vussonji of Dhaval Vussonji & Associates, who is representing the operational creditor at NCLAT told BusinessLine that as per the plan approved by the Appellate Tribunal the entire dues of about ₹450 crore of Operational Creditors will be paid in 30 days from the date of sanction.
NCLAT also rejected Binani Cement promoters application to withdraw the insolvency proceedings for an out-of-court settlement stating the provision has come into force on June 6 much after the impugned order was passed on May 2.
Moreover, it said the applicant has not filed the withdrawal application after taking approval from 90 per cent voting share of the CoC.