Kwality Insolvency Case: NCLT Directs Lenders To Consider Haldiram Snacks’ Revised Offer
The National Company Law Tribunal has directed the lenders of Kwality Ltd. to reconsider the revised Rs 145-crore offer by Haldiram Snacks to acquire the debt-ridden dairy firm.
The NCLT's Delhi-based bench has also extended the corporate insolvency resolution period by another three weeks and directed the Committee of Creditors to reconsider the enhanced offer.
Earlier, the lenders of Kwality had rejected the Rs 142 crore bid of Haldiram Snacks, which emerged as the sole bidder to acquire the debt-ridden dairy firm.
Haldiram Snacks then revised its offer marginally and approached the NCLT with a plea that its latest resolution plan should be considered by the lenders as the offer is higher than the liquidation value.
In 2018, NCLT ordered insolvency proceedings in Kwality on a petition filed by global private equity firm KKR & Co.. Shailendra Ajmera of EY, was appointed as the resolution professional to conduct the insolvency proceedings.
On Nov. 2 this year, the CoC rejected Haldiram Snacks' Rs 142 crore resolution plan, as only about 40 percent of the lenders voted in favour of the resolution plan as against the requirement of 66 percent. Kwality has a total debt of around Rs 1,900 crore.
Kwality had in 2016 raised Rs 300 crore from KKR India Financial Services and received an additional commitment of Rs 220 crore. The amount was raised to fund expansion plans and enter into the consumer segment.
The company is engaged in the business of milk processing and manufacturing of dairy products, including ghee, milk powders, lassi, chaach and flavoured milk. It owns two milk processing units, one in Softa, Haryana, and another in Dibai, Uttar Pradesh. Haldiram sells sweets and other snacks through its own outlets as well as retail chain.