Kolkata: Operational creditors have joined the legal battle over the sale of Binani Cement Ltd, saying they will be short-changed if Dalmia Bharat Ltd’s offer for insolvency resolution is accepted by the National Company Law Tribunal (NCLT).
In a statement, operational creditors described Dalmia Bharat’s offer as a “cruel joke”. They have already filed petitions with the NCLT alleging that the resolution professional ignored their interest.
A spokesperson for operational creditors, Siddharth Tibrewal, said in a statement that the resolution professional had assessed dues to trade partners at Rs503.37 crore, whereas the firm owed them over Rs700 crore. Dalmia Bharat has offered to settle these dues for Rs151 crore, which is a “pittance”, he claimed.
Also, according to Tibrewal, Dalmia Bharat in its offer has said it will not pay anything to trade partners and vendors who are related to the management of Binani Cement. A forensic audit conducted by an external consultant at the behest of financial creditors has already exposed questionable transactions by the firm worth over Rs2,400 crore.
Asked about Dalmia Bharat’s offer to operational creditors, Mahendra Singhi, group CEO, said there was no provision now to change the bid. Dalmia was declared the “successful bidder” and the “resolution plan is over”, he added. The firm has offered Rs6,700 crore for Binani Cement.
UltraTech Cement Ltd, which was initially outbid by Dalmia Bharat but later struck a deal with Binani Industries to acquire 98.43% in the cement maker for Rs7,266 crore, has alleged that the bidding for the company should be cancelled because the findings of the forensic audit had not been disclosed to the bidders.
On Monday, the counsel for Binani Cement’s lenders took time till 8 April to decide whether to consider UltraTech’s offer after the Kolkata bench of the NCLT said “in the larger interest of all stakeholders” an out-of-court settlement should be considered. But lenders have not rejected Dalmia Bharat’s resolution plan, which has been submitted to NCLT, for fear of legal implications.
Though the Supreme Court has set a precedent for termination of resolution processes, Binani Cement’s lenders are concerned that Dalmia Bharat may drag them to a higher court if its bid is rejected, said a lawyer briefed on the dispute.
A resolution plan has to be finalised in less than two weeks, failing which Binani Cement may be ordered to be liquidated, or sold as scrap, under provisions of the Insolvency and Bankruptcy Code, added the lawyer, asking not to be named.
Tanya Thomas in Mumbai contributed to this story.