Debt-ridden Punj Lloyd has failed to secure bids in the second e-auction held for the sale of the engineering company as a going concern, people familiar with the matter said.
“Auction has failed as two or three responses were received but the reserve price was too high,” said one of the persons cited earlier.
The sale price was boosted by intangible assets whose time frame for realisation is not assured, the person said.
The liquidator, appointed by the National Company Law Tribunal (NCLT), has been tasked to complete the liquidation process by December 2023, and will have to approach the shareholders’ consultative committee to reconsider the reserve price, set at ₹1,061 crore for the second e-auction.
The liquidator will now have to seek approval from the NCLT for a third auction.
The shareholders’ consultative committee had refused to budge on the price for the second e-auction, for which an earnest money deposit of ₹10 crore had to be submitted by August 25.
The advertisement for the second e-auction was issued on July 24. The earlier auction held on July 10 had failed. In June, the NCLT granted a six-month extension until the end of the year for liquidation of the company as a going concern.
The principal bench of the NCLT issued the order to liquidate Punj Lloyd in May 2022, four years after ICICI Bank had approached the tribunal to initiate insolvency proceedings for a default of ₹854 crore.
The lenders had rejected the revival plan submitted by a consortium comprising Prudent ARC and Payard Investments for the group, which once operated 40 companies.
