Himadri Speciality, Dalmia Bharat Refractories to acquire Birla Tyres for Rs 347 crore
The Kolkata Bench of the NCLT has approved the Rs 347 crore resolution plan jointly submitted by Himadri Speciality Chemical Ltd and Dalmia Bharat Refractories Ltd for acquisition of Birla Tyres.
In a regulatory filing, Himadri Speciality Chemical informed that the NCLT, Kolkata Bench has “now approved verbally the resolution plan submitted jointly by the company (strategic partner) and Dalmia Bharat Refractories Ltd (resolution applicant) for acquisition of Birla Tyres Limited under the corporate insolvency resolution process (CIRP) in terms of the Insolvency and Bankruptcy Code, 2016 (IBC).”
A written order from the NCLT is awaited. Though the full details of the resolution plan are not known, the resolution plan provides for Rs 316 crore to secured financial creditors against their total admitted claims of Rs 1,097 crore. Resolution plan was earlier approved by the committee of creditors by a vote share of 82.48%.
The NCLT had ordered the initiation of insolvency proceedings against Birla Tyres Ltd in a case filed by chemicals firm SRF Ltd, an operational creditor of the B K Birla group firm. Birla Tyres was demerged from the group’s flagship firm Kesoram Industries in 2018.
The company owed Rs 16,696 crore to different creditors including Rs 1,152 crore to financial creditors. The Committee of Creditors, which comprises financial creditors, has 12 members with Axis Bank having the highest (49.25%) vote share. Axis Bank has admitted claims of Rs 555 crore. Asset Reconstruction Company (India) Ltd has second highest vote share (17.39%) with admitted claims of Rs 196 crore.
Birla Tyres, a listed entity, was established in 1991 as part of Kesoram Industries Limited, initially collaborating in the production and development of its tyres with world-class tyre manufacturer Pirelli. Birla Tyres demerged from Kesoram Industries Ltd vide NCLT Order dated 08 November 2019, under scheme of arrangement and listing of shares effective from 01 January 2019. It got listed on Bombay Stock Exchange and National Stock Exchange with effect from 10 February 2020.
Also Read: Birla Tyres in insolvency court after failing to pay Rs 16 crore to vendor SRF Ltd
