Indian tribunal rules UltraTech's bid for Binani Cement valid (updated)

BIL Vyapar

14/11/2018 08:40

(Changes source, adds details, analyst comment, background)
    Nov 14 (Reuters) - An Indian tribunal has ruled that
UltraTech Cement Ltd's  ULTC.NS  more than $1 billion bid for
the cement unit of Binani Industries Ltd  BINZ.NS  was valid,
UltraTech said on Wednesday.
    UltraTech offered to buy Binani Cement in March after its
parent Binani Industries approached UltraTech to arrange funds
for paying-off bank debts and other liabilities, in a bid to
terminate the insolvency proceeding against its unit.
 urn:newsml:reuters.com:*:nL3N1R14LV
    The National Company Law Appellate Tribunal(NCLAT) dismissed
an appeal by Rajputana Properties Private Ltd, owned by Dalmia
Bharat Ltd  DALA.NS , saying its offer for Binani Cement was
"discriminatory" against financial and operational creditors.
    "NCLAT is a step forward, but I think everyone is well on
board that it is not concluded," said Murtuza Arsiwalla, a
senior analyst with Kotak Institutional Equities in Mumbai.
    Dalmia Bharat and a fund backed by Bain Capital and India's
Piramal Enterprises  PIRA.NS  had bid for Binani Cement and had
already won approval from the company's panel of creditors as a
part of the bankruptcy process.
    "I do believe Dalmia will go to the Supreme court - I don't
think it will give up without a fight, so this is not a settled
issue just yet," Arsiwalla added.
    Binani Industries had sought to withdraw the unit from the
ongoing bankruptcy proceedings at the National Company Law
Tribunal (NCLT) and a deal with UltraTech would mean no haircuts
for the creditors.
    UltraTech's 72.66 billion rupee ($1.01 billion) offer will
fetch it 98.43 percent of Binani Cement.
    Given the valuations that UltraTech is paying for Binani
Cement, this will be an earnings drag at least for 2-3 years,
analyst Arsiwalla said.
 ($1 = 72.1250 Indian rupees)

 (Reporting by Krishna V Kurup and Chris Thomas in Bengaluru;
Editing by Subhranshu Sahu and Gopakumar Warrier)
 ((chris.thomas@thomsonreuters.com; +91-80-6749-8695; Reuters
Messaging: chris.thomas.thomsonreuters.com@reuters.net))