In a rare occurrence, the voting to select the winner between Nalwa Steel and BTL EPC plan for bankrupt McNally Bharat Engineering resulted in a tie, as both resolution plans received an equal number of votes from lenders, said people aware of the development.
Resolution plans given by Naveen Jindal-promoted Nalwa Steel and Power and Kolkata-based Shrachi Group-promoted BTL EPC received 90.16% voting resulting in a tie-breaker situation on Wednesday when the voting deadline ended for the company undergoing insolvency proceedings.
As per the Insolvency and Bankruptcy Board of India (IBBI) the resolution professional is mandated to invite lenders to vote on all eligible plans. The plan that receive the highest vote and above the 66% threshold level is declared as a winner.
On Thursday, lenders declared BTL EPC (formerly Bengal Tools EPC) as winning bidder per tie-breaker formula which gives higher weightage to the net present value (NPV) of the plan, the people cited above said.
BTL EPC offered ₹445.2 crore while Nalwa Steel and Power gave a plan of ₹426 crore for the EPC company promoted by the Khaitan family of Williamson Magor Group. Resolution Professional Ravi Sethia-backed KPMG did not respond to ET request for comment.
RP has admitted ₹4,839.7 crore from financial creditors, according to the company’s website.
Of this, claims from bank creditors are ₹3,700 crore. Lenders received 17 expressions of interest as reported by ET on October 22, last year.
“Both plans were equally good but since lenders were not sure which plan would receive higher votes, they gave positive votes for both the plan” said one of the lenders. Positive vote on both plans is also because the IBBI rules stipulate that those lenders who vote against a plan would receive liquidation value.
RP conducted two auction rounds among the two bidders, wherein Nalwa Steel emerged as the highest bidder. Mid-2022, the Khaitan family had completely exited Eveready Industries, maker of dry batteries and flashlights, by selling their stake to the Burman family, promoters of Dabur Ltd.
Source: Economic Times