Mumbai : A consortium of Dalmia Bharat and Piramal have emerged as the highest bidder for buying Binani Cement, beating Aditya Birla Group-owned UltraTech, which was also in the fray for the cement maker, according to sources.
Lenders led by Bank of Baroda (BoB) on Tuesday held a meeting in Mumbai and decided to vote for the Dalmia Bharat consortium as the highest bidder, the sources said.
Dalmia Bharat and Piramal team have placed an offer of around Rs 6,300 crore for the debt-laden cement maker while UltraTech’s bid price was around Rs 6,200 crore, the sources added.
BoB had referred Binani Cement to the bankruptcy court after it failed to repay Rs 410 crore to the lender.
The consortium of Dalmia Bharat and the Piramals offered to repay the entire arrears of secured and unsecured lenders, amounting to Rs 6,313 crore. It also agreed to make part payments to operational creditors.
UltraTech offer was almost at par, but as per the evaluation criteria they suffered on account of penalties that were levied by the Competition Commission of India,” said one of the of
In 2016, CCI had imposed a penalty of Rs 1,175.49 crore on UltraTech. This was part of an overall penalty of Rs 6,700 crore on 11 cement companies, including UltraTech, ACC, Ambuja Cements, Ramco Cements and JK Cement, as well as industry body Cement Manufacturers Association for indulging in cartelisation. UltraTech approached the Competition Appellate Tribunal against the order, which stayed it.
Binani Cement is part of the Braj Binani Group and is a subsidiary of Binani Industries (BIL). BIL is the holding company of the group, and has presence in five key businesses areas including cement, fibreglass, infrastructure and energy.
Cement demand in the country is expected to grow about 4.5 per cent in 2018-19 on the back of pick-up in housing segment, and higher infrastructure spend, according to rating agency ICRA said.
Domestic cement production during April-December 2017-18 stood at 216.5 million metric tonne (MMT), higher by 2.7 per cent compared to 210.8 MMT during the same period of previous financial year.
