Bags of Binani cement sit in a shop in Gurgaon (Photographer: Adam Ferguson/Bloomberg News)

NCLAT Upholds UltraTech’s Bid For Binani Cement

UltraTech Cement Ltd. has got the NCLAT’s approval to acquire Binani Cement Ltd.

The National Company Law Appellate Tribunal rejected Dalmia Group’s bid saying it’s discriminatory to some of the creditors of Binani Cement. On Aug. 30, the NCLAT had reserved its judgement on the Binani Cement insolvency matter.

The Story So Far

Dalmia Bharat-led Rajputana Properties had emerged as the top bidder for acquisition of assets of Binani Cement. But subsequently UltraTech, which was the second highest bidder, came back with a revised higher offer, backed by the original promoters of Binani Cement.

In May this year, the Kolkata bench of the NCLT had directed Binani Cements’ committee of creditors to consider UltraTech’s revised offer. It had also permitted Dalmia Group to match UltraTech’s revised offer, if it so chooses.

Dalmia Group had appealed this decision before the NCLAT, which in an interim order, reiterated the judgment passed by the NCLT. The interim order was then challenged by Dalmia Group in the Supreme Court which declined to interfere in the case at that stage and asked the appellate tribunal to decide on the disputes raised by all sides.

The apex court had asked the appellate tribunal to decide on the objections of all parties in the case, including the eligibility of UltraTech’s bid that was challenged under Section 29A of the Insolvency and Bankruptcy Code. Section 29A lays down the ineligibility criteria for resolution applicants.

The insolvency proceedings against Binani Cement were initiated by Bank of Baroda before Kolkata NCLT in July last year. The offer by Dalmia Group was approved the committee of creditors. UltraTech’s first bid was less than Dalmia Group’s offer. The CoC at the time had decided to only negotiate with the highest bidder. UltraTech had attempted to revise its offer for Binani Cement, but was not allowed to do so by the creditors’ committee and the resolution professional.