Inventory auction of erstwhile Nirav Modi firm Firestar Diamond fetches Rs 32 crore
The liquidator of Firestar Diamond International Pvt Ltd managed to raise Rs 32.16 crore from the auction of precious inventory of the erstwhile Nirav Modi firm. This is 6% more than the reserve price of Rs 30.26 crore. Liquidator Santanu T Ray, a partner with AAA Insolvency, conducted the 9th and 10th round of auctions on 9the and 11th May 2023 respectively.
The 9th auction, held on 9th May 2023, included finished gold, platinum, diamond, and other precious studded jewellery, and the 10th auction, held on 11th May 2023, included raw materials like gold, platinum, silver, and loose diamonds.
According to information shared by AAA Insolvency, the auctions had several salient features.
All inventory was independently certified by the Gemmological Institute of India (GII), a Certification Laboratory promoted by the Gems and Jewellery Promotion Council Govt. of India and the Industry players.
“The sole purpose of getting this additional certification done was to assure the buyers of the genuineness of the goods and also to protect against large variation in valuation between two valuers, so that the stakeholders get the correct price for the goods and the value is maximized,” says Anil Goel, founder and Chairman of AAA Insolvency Professional.
The valuation was done after certification by two IBBI registered RVEs. The entire goods were sold on a certificate basis by providing access to a virtual data room where images along with certificates of the jewellery and certificates of the raw materials were uploaded. No physical inspection could be given due to security concerns. The reserve price was set based on the price of Gold, Platinum, and Silver on the date of each auction.
The auction was conducted over two days and in smaller lot sizes to enable more participants to take part in the process. As many 31 participants showed interest in the auction, of which 20 participants put in EMDs and participated in the auction. In all, more than 400 EMDs (for various options) were received.
Insolvency proceedings against Firestar Diamond was initiated by government-owned Corporation Bank in 2019. The NCLT in 26 February 2020 ordered liquidation of the Nirav Modi firm. A couple of Nirav Modi firms in the US also filed for chapter 11 insolvency in 2018.
Also Read: PNB receives $3.25 mn from liquidation of Nirav Modi-owned Cos in US
