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Dalmia Bharat set to buy Binani Cement; Ultra Tech likely to challenge deal

Interestingly, in the first round of bids for Binani Cement, JSW Cement had emerged the highest bidder

Avishek Rakshit & Dev Chatterjee  |  Kolkata/Mumbai 

Dalmia Bharat, Binani cement, Ultra Tech cement,  National Company Law Tribunal , NCLT,Deloitte ,Murli Cement and Kalyanpur Cement,  JSW Cement,
Binani Cement has debts of around ~40 billion and it is one of the rare cases where banks are not taking a haircut

After a series of controversies, the consortium led by Cement has received final approval from the Committee of Creditors (CoC) of to acquire the firm for Rs 67 billion, which includes a capital infusion of Rs 4 billion. This was despite Aditya Birla Group firm UltraTech Cement putting in a higher bid for

UltraTech is likely to challenge Cement’s offer in the (NCLT).

The CoC voting, which went for over four hours on Wednesday, approved the resolution plan proposed by Cement, a source told Business Standard.

has debts of around Rs 40 billion and it is one of the rare cases where banks are not taking a haircut.

“Usually after the CoC voting, it takes two to three days to place the proposal before the for final approval,” said the source quoted above.

"Expect a full-scale legal battle as the resolution professional ran a non-transparent process while ignoring our offer of Rs69 billion," an UltraTech executive said.

On Tuesday, the asked Vijaykumar Iyer, the resolution professional for Binani Cement, to appear in person in the Tribunal to answer questions on the bidding process. UltraTech had moved the against the resolution professional and for rejecting its bid for Binani Cement. In its petition, UltraTech had alleged the resolution professional did not follow a transparent method in the bidding process and did not offer any details on what grounds its bid was not allowed.

A spokesperson had earlier declined to comment on the issue citing client confidentiality. A Dalmia Bharat spokesperson said the company would not comment on the Binani Cement acquisition at present.

Interestingly, the promoter of Binani Cement, Binani Industries, has already challenged the resolution professional in the same tribunal, saying the RP has “personal interest” in undervaluing Binani Cement and then selling it to his preferred bidder. According to Binani Industries, the value of Binani Cement is Rs173 billion.

If the deal is finally endorsed by the NCLT, it will be the third such acquisition by Dalmia Bharat Cement, the other two being

According to industry sources, the details of how the weights were assigned should be made public.

Interestingly, in the first round of bids for Binani Cement, had emerged the highest bidder. But its offer was rejected and another round of bids was called. However, no details were given to the bidders on the process followed.

First Published: Thu, March 15 2018. 00:34 IST