The Mumbai bench of the National Company Law Tribunal (NCLT) has accredited the sale of Uttam Value Steel Ltd and Uttam Galva Metallics to a joint consortium of CarVal Investors and Nithia Capital Resources Advisors for ₹2,300 crore, mentioned an individual conscious of the event.
“This is among the many first resolutions the place the company insolvency decision course of (CIRP) of two firms labored in tandem. The two firms are interlinked when it comes to manufacturing and due to this fact getting two totally different decision plans for them made no sense,” mentioned the particular person quoted above. He added that Uttam Galva Metallics was filed in NCLT Chandigarh, the petition in opposition to the opposite firm was filed in Mumbai.
“To guarantee a easy decision course of of those linked firms, the case was transferred from Chandigarh to Mumbai,” the particular person mentioned.
The decision plan would enable lenders to get near 40% of their claims for each the businesses. While the decision skilled (RP) admitted ₹3,634 crore of economic creditor claims in Uttam Galva Metallics, it was at ₹2,479 crore for Uttam Value Steel, as on 9 April. Union Bank of India has the best publicity in Uttam Galva Metallics at ₹921 crore, adopted by Bank of Baroda at ₹680 crore and Punjab National Bank at ₹571 crore, amongst others.
Union Bank of India additionally has the best publicity in Uttam Value Steel, at ₹589 crore. The different lenders are Punjab National Bank at ₹466 crore, State Bank of India at ₹416 crore and Bank of Baroda at ₹277 crore, amongst others.
While the joint decision plan was accredited by the committee of collectors (CoC) in April final 12 months, SSG Capital, the opposite bidder for these belongings contested the choice. The case to determine on SSG’s claims was then heard by a two-judge bench in Mumbai NCLT, the place each judges took opposing views. The matter was then heard by the principal bench of the NCLT in New Delhi which dismissed SSG’s plea.
“The profitable bidders had submitted a efficiency financial institution assure of ₹500 crore for each firms and it could have expired on 30 April if the plan was not accredited,” mentioned the particular person quoted above, including that if not for last-minute litigation, the decision would have been sooner.
Since its inception, the IBC course of has been mired in last-minute litigations with promoters making an attempt exhausting to retain management of their firms. Take the occasion of Essar Steel. While IBC prescribes for asset decision to occur inside 330 days, Essar Steel’s decision and sale to Arcelor Mittal took 866 days.