Following the announcement that Binani’s liabilities were in-effect higher than the original estimate, major cement cos are vying for another shot at buying bankrupt Binani Cement’s assets, setting the stage for one of the most competitive bids under the insolvency process.
Sources close to the matter have stated in the media that creditors and the resolution professional of Binani Cement have sought fresh bids from some of the suitors who had made offers last month.
The increase in liabilities was discovered when it was un-earthed that a corporate guarantee for the acquisition of a fibreglass asset was made in Europe known as 3B in 2012 for around Rs 1,600 crore.
In the fray for a bidding war is Kumar Mangalam Birla, Puneet Dalmia, Ajay Piramal, Sajjan Jindal and Rakesh Jhunjhunwala, according to reports in the media. Binani’s substantial capacity with limestone reserves and captive power facilities have attracted the who’s-who from the cement sector.
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Experts believe the rebid may largely see a three-way competition involving Ultratech, Dalmia-Bain Piramal and JSW. The liquidation value is believed to be Rs 1,600 crore, meaning no bids below that price will be accepted. The first two are trying to plug their gaps and emerge as leading pan-India players while JSW, which lost out to Nirma for Lafarge’s India assets, is looking to scale up its own capacity through acquisitions.
Inputs from ET