NCLT pulls up Binani’s resolution professional

The Kolkata Bench of National Company Law Tribunal (NCLT) on Tuesday asked Vijaykumar Iyer, a resolution professional of Binani Cement, to appear in person in the tribunal in its next hearing to answer questions on the bidding process followed in the company’s debt resolution.

The NCLT was hearing a petition filed by Aditya Birla group’s UltraTech against the resolution professional and Deloitte for rejecting its bid for Binani Cement. In its petition, UltraTech had alleged resolution professional did not follow a transparent method in the bidding and did not give any details on what grounds its bid was not allowed.

Last week, Ultratech increased its bid by ~7 billion to ~69 billion but there was no response from the resolution professional. UltraTech offered to pay 100 per cent of secured lenders and unsecured lenders debt. “The NCLT hauled up resolution professional for not being transparent and not following the process. The tribunal asked the resolution professional to appear in person,” a source said.

A Deloitte spokesperson had earlier declined to comment on the issue citing client confidentiality. A Dalmia Bharat spokesperson said the company was not commenting on Binani Cement acquisition.

The resolution professional and the Committee of Creditors had selected Dalmia Bharat Cement’s ~63 billion offer, which had offered to repay all secured lenders but only one unsecured lender— IDBI Bank. This was because IDBI Bank had a say at the CoC table while none of the insecured creditors of Binani Cement had any voting power. The Dalmia Bharat offer “squeezed out” the rest of the non-financial bidders, a source said.

The promoter of Binani Cement and Binani Industries has challenged the resolution professional in the same tribunal saying the resolution professional has “personal interest” in undervaluing Binani Cement and then selling it to a preferred bidder. According to Binani Industries, the value of Binani Cement is ~173 billion.