Assam Company bid submission date postponed to June 27

Under pressure to grant more time for submission of financial bids from interested buyers, the resolution professional (RP) of Assam Company India Ltd, which is undergoing insolvency proceedings, has extended the bid submission date to June 27 this year. The RP's decision was accelerated by an order from the NCLAT granting more time to one of the bidders.

After James Warren Tea, an interested bidder, was disqualified by the RP, T Kannan, on financial eligibility to bid for Assam Company, it had moved the NCLAT, where the appellate court ordered that James Warren can submit a resolution plan under the IBC framework by June 27 4:00 pm.

Sources suggested that this decision of the NCLAT was pivotal in the RP extending the bid submission date.

“Other interested bidders have already asked for more time to submit a resolution plan and on the other hand, NCLAT has given James Warren an extension. Thus, it makes sense to keep the bid submission date on June 27 for all the bidders,” a source said.

When contacted, the RP refused to comment, citing client confidentiality.

Sources suggested that Dhunseri Tea & Petrochem, Apeejay Group, James Warren Tea, The Chatterjee Group and two asset reconstruction companies (ARC) -- Arcil Asset Reconstruction Company and Suraksha Asset Reconstruction-- are most likely to submit financial bids.

“We have received the information memorandum today (June 21) and have just stated studying it after which we will place our bid,” Akhil Ruia, CEO at James Warren said.

It has deposited an earnest money deposit of Rs. 50 million and a participation fee of Rs. 1 million to obtain the information memorandum and place its bid.

However, the MK Shah Group, which once was exceedingly interested to acquire Assam Company and had initiated a long-drawn litigation process, may not put up any bids. It recently acquired eight premium tea estates from McLeod Russel for Rs. 3.31 billion.

“Whether we will place any bids or not depends on the final outcome of the proceedings in NCLAT where it will be heard on July 3. The condition of the gardens is not good and a lot of capital expenditure over atleast 2-3 years has to be incurred to turn them around,” Himanshu Shah, chairman at MK Shah Exports said.

Sources, however, suggested that MK Shah may not push its case in NCLAT as it has already acquired some gardens and its “appetite for expansion is satiated to a large extent”.

Interested buyers are valuating the gardens between Rs 230-310 a kilo.