INSUBCONTINENT EXCLUSIVE:
MUMABAI: Bank of Baroda has sold its Rs 410 crore loans in Binani Cement to Edelweiss Asset Reconstruction Company in a reflection of the
lenders’ frustration in resolving a bankruptcy that’s mired in litigation, said two people familiar with the matter.
The sale of the
loan involves a structured transaction where the lender would receive a portion of the profits if the ARC is able to recover more than what
it was originally valued at, said those people who did not want to be identified.
“It is a structured deal wherein Edelweiss ARC gave the
highest offer,” said an official
“As per the structure, Edelweiss ARC would share the upside with Bank of Baroda once the Binani Cement resolution plan finally goes
through.”
Aditya Birla Group-owned Ultra-Tech and Dalmia Cement are quarrelling over the control of Binani Cement with each bettering the
offer of the other and questioning the validity of each others’ offers.
Lenders had approved a resolution plan of UltraTech Cement which
is being opposed by Dalmia Bharat on grounds that they had offered more than UltraTech.
Dalmia Bharat emerged the highest bidder with Rs
6,582 crore offer which was approved by 99.5 per cent of lenders, but this was challenged by UltraTech at bankruptcy court on grounds that
the bidding process was not transparent and went on to raise the bid to Rs 7,600 crore.
