New Delhi: The Competition Commission of India (CCI) on Wednesday unconditionally approved the proposed acquisition of Binani Cement Ltd by Rajputana Properties, subsidiary of Dalmia Bharat Cement Ltd.
Binani Cement is currently undergoing a corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016 (IBC).
This is the first transaction to be notified to the CCI involving the acquisition of a corporate debtor under the insolvency code. The transaction has been cleared by the competition commission within 13 working days after it was filed.
According to a Mint story on 28 February, the Dalmia consortium had agreed to invest around Rs6,700 crore in the stressed cement firm over a period of time. Binani Cement, which was admitted by the National Company Law Tribunal (NCLT) in July 2017 for resolution under the Insolvency and Bankruptcy Code, owes around Rs6,500 crore to its lenders.
The race for Binani Cement saw Dalmia Bharat Cement Ltd and UltraTech Cement Ltd as the top two contenders, submitting nearly identical bids. The two finalists submitted bids of roughly around Rs6,000 crore each, two people close to the bidding process had told Mint, adding that the amount includes upfront cash payments, as well as an offer of close to 20% stake in Binani to lenders.
Binani Cement is part of the Braj Binani Group and is a subsidiary of Binani Industries Ltd (BIL). BIL is the holding company of the group, and has presence in five key businesses areas including cement, fibreglass, infrastructure and energy.
Bloomberg was the first to report on 17 February that the race for Binani has narrowed down to Dalmia Bharat Cement, backed by Bain Piramal Resurgence Fund, and Aditya Birla Group company UltraTech.