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SC refuses out of court settlement for Binani; big blow to UltraTech

We believe this is a setback for UltraTech as now Dalmia Bharat stands a clear winner of the Binani Cement assets.

Binani Industries has withdrawn its petition seeking termination of insolvency process and permission for an out-of-court settlement with UltraTech Cement, in the Supreme Court, as per Bloomberg. This was post the Supreme Court refusal for any out-of-court settlement.

We believe this is a setback for UltraTech as now Dalmia Bharat stands a clear winner of the Binani Cement assets.

On March 27 2018, the NCLT had suggested an out-of-court settlement between Binani Industries and its committee of creditors. Binani Industries was seeking termination of insolvency proceedings related to Binani Cement and approached UltraTech and had signed an agreement with UltraTech Cement to sell its 98.43% shareholding in the cement business for Rs7,266cr.

On April 9 2018, Binani Industries moved to the SC bypassing the National Company Law Tribunal (NCLT) in order to get approval for an out-of-court deal with UltraTech as they termed Dalmia Bharat offer to be much lower and not favorable for the company and the creditors.

Dalmia Bharat-Bain Piramal consortium was declared the highest bidder for Binani Cement with an offer to pay Rs6,350cr, however, post that UltraTech Cement had made a separate out-of-court offer to its parent firm for Rs7,266cr.