Piramal Group likely to buy stake in Binani Cement, Electrosteel Steels

Moneycontrol news

Piramal Group could buy stake in the debt-laden Binani Cement and Electrosteel Steels, as per a report in the Business Standard. The news comes after creditors of these companies asked top companies to bid for stressed assets under the insolvency process.

The distressed asset fund of the Piramal Group has asked for data from the banks on the two companies, a source told the newspaper.

While Binani Cement owes Bank of Baroda Rs 97 crore and is also to a group of Indian lenders headed by Edelweiss Asset Reconstruction Company for Rs 3,700 crore as of March 2016.

Electrosteel Steels has a debt of Rs 10,288 crore. It is one of the 12 companies identified by RBI for resolution under the Insolvency and Bankruptcy Code (IBC).

The distressed assets of both companies were referred to the National Company law Tribunal (NCLT) after the companies defaulted on the bank loans.

Six companies such as Srei Infrastructure, Tata Steel, Mesco Steel, and Edelweiss are officially interested in buying stake in Electrosteel.

The loss-making Binani Cement has 11.25 million tonnes of global capacity and 6.25 million tonnes of domestic capacity, and hence, has attracted several cement makers other than Piramal, a lender said.

Lenders told BS that they had asked Piramal Group to join one of the companies that had already submitted the official ‘expression of interest’ for Electrosteel Steels.

Piramal Group joins JSW, Vedanta and Tata Group who are currently belligerent in bidding for distressed assets with a special focus on infrastructure and steel sectors.

Lenders also said that the Piramal Group have formed an in-house distressed asset fund along with Bain Capital Credit. They are considering investment in distressed assets to the tune of USD 1 billion in coming years.