15 firms keen on bankrupt Binani Cement

27 November 2017

As many as 15 companies, including three large overseas players, have shown interest in Binani Cement, which is facing bankruptcy proceeding from its lenders, senior officials, who did not want to be named, told ET.

Among the foreign players, Dublin-based CRH, one of largest building material companies in the world, Lafarge and Heidelberg Cement have shown interest in response to initial bids called by the resolution professional.

Other bidders include local firms India Cement, Orient Cement, Ramco Cement, Shree Cement, UltraTech and Piramals. Senior officials said nine domestic players and three financial investors have shown interest in the company.

The bidders will provide a binding bid with a detailed resolution plan that would involve acquiring equity and recasting the debt by December 22.

The bidders will have to give plans on either acquiring the company fully or its assets. Binani has a manufacturing capacity of 11.25 million tonne (MT) per annum with integrated plants in India and China, and grinding units in Dubai.

Bank of Baroda referred the Binani Cement, a subsidiary of Binani Industries, to the National Company Law Tribunal in July after it failed to repay a Rs 97 crore loan.

The bank has appointed Vijaykumar V Iyer as the resolution professional. The resolution professional has received a total claim of around Rs 7,500 crore, which includes corporate guarantees given by banks.

Claims from lenders is Rs 6,313 crore which includes claims on account of corporate guarantee of Rs 2,429 crore. This corporate guarantee includes Rs 1,567 crore issued by IDBI Bank, which has not yet been accepted by the RP on the grounds that the guarantee has not yet been accepted by the RP on the grounds that the guarantee has not been invoked. However, the RP has accepted a claim by Exim Bank of bank guarantee of Rs 588 crore.

Lenders SBI, Bank of Baroda, Canara Bank and IDBI have outstanding loan of Rs 1,211 crore against Binani, while Edelweiss Asset Reconstruction Company has Rs 2,773 crore. Driven by the resolution of assets, the cement industry is going through a consolidation phase.

Source: ET