After months of drama in courts and allegations of favouritism by the resolution professional, tea and oil company Assam Company NSE 3.64 % (India) is finally set to be bagged by billionaire B R Shetty, three people familiar with the development said.
The Abu Dhabi-based businessman’s BRS Investment is estimated to have bid more than Rs 700 crore for the company incorporated back in 1839, significantly higher than the next bid of around Rs 500 crore, they said.
The other bidders included Suraksha Asset Reconstruction, Dhunseri Petrochem and James Warren Tea. “The race looked like it was leaning towards Dhunseri from the beginning, the sweeping bid came out of the blue,” one of the sources said.
Another person involved said, “His (Shetty) swooping in like a white knight may finally be the salvation of Tagore’s remnants.” Assam Co tea estates were started by poet Rabindranath Tagore’s grandfather. In the last few days some of the qualified nine bidders decided not to bid when they came to know of Shetty’s interest in the company, sources said. Shetty — who has been investing in health and education in recent times — has tea and coffee plantations in Karnataka.
The resolution process for Assam Co has been shrouded in controversy since April when the bid deadline came up. Two companies, M K Shah Exports and James Warren, challenged the criteria set for qualifying bidders as partial towards select companies.
One of the companies also filed a complaint of favouritism against resolution professional T Kannan of LSI Resolution. National Company’s Law Tribunal then allowed exemptions on the initial rules for bidders like James Warren that showed genuine interest.
ET had earlier reported that internally the resolution professional had written off the value of Assam Co’s oil business, shutting the Delhi office that ran it. Creditors had also approved a liquidation value of around Rs 300 crore.
Around 17,000 employees of Assam Co had not received salaries for over two months, part of which have since been paid.
Source: Economic Times