UltraTech Cement recently upped its offer to Rs 79.6 billion after a second round of revision, outbidding Dalmia Bharat’s offer by Rs 11 billion.
While presenting his case before the Kolkata Bench of the National Company Law Tribunal (NCLT) on Thursday, Mukul Rohatgi, representing UltraTech Cement, said: “Ask Dalmia Bharat to increase its bid and match our offer. In case it does, we will again increase our bid by another Rs 5 billion.” He was speaking in reference to Insolvency and Bankruptcy Code's objective of maximisation of value and said the NCLT had the final right to approve or turn down a proposal that comes to it.
He pleaded before the tribunal that a fresh meeting of the committee of creditors (CoC) should be ordered to evaluate the proposals by UltraTech Cement and Dalmia Bharat-led consortium. The CoC had on March 14 chosen Dalmia Bharat’s proposal. The appeal rested on the notion that despite UltraTech Cement making a revised offer on March 8 and the resolution professional, Vijay Kumar Iyer, writing to this company that its revised bid would be called upon when its plan is considered, the plan of Dalmia Bharat-led consortium was put to vote on March 14.
After Thursday's hearing, Rohatgi clarified that the law did not prohibit negotiations by the CoC with an H2 bidder and alleged that the selection process of the H1 bidder by the CoC was flawed from the beginning, which resulted in his client landing up as the H2 bidder.
He asked the tribunal to exercise “supervisory powers” and take cognisance of the fact that a higher bid by UltraTech Cement was up for consideration when a lower bid was submitted for the tribunal’s consent.
On April 20, the stipulated 270-day period under the IBC comes to an end. Unless the NCLT approves a resolution plan, the company would go in for liquidation. The tribunal, however, has discretionary powers to extend the timeframe or keep off the litigation timeframe from the stipulated period under IBC.
Rohatgi stated before the tribunal that even if Binani Cement goes in for liquidation, UltraTech Cement would eventually takeover this company, as it was confident to outbid others.
After the bidding for Binani Cement commenced, UltraTech Cement had quoted an offer that was marginally lower than Dalmia Bharat, but upped its offer after conclusion of the bidding process to Rs 72.66 billion. Later, it increased its offer to Rs 79.6 billion.
Dalmia Bharat has maintained that its selection rests on adherence to IBC and its offer of Rs 65-66 billion has been approved by the CoC as they were satisfied with the bid.