Kwality Ltd goes for liquidation after CoC rejected Haldiram Snacks bid
Kwality Ltd, the Delhi-based dairy company, has been ordered to be liquidated after the insolvency proceeding failed to yield any resolution.
The Delhi bench of the National Company Law Tribunal (NCLT) ordered liquidation of the company on 11 January 2020.
During the corporate insolvency resolution process (CIRP), which was administered by resolution professional Shailendra Ajmera, only one resolution plan was submitted by the consortium of Haldiram Snacks and Pioneer Securities despite multiple extension for submission of Expression of Interest (EoI). Haldiram Snacks and Pioneer Securities were offering Rs 145 crore to acquire Kwality.
The resolution plan was put to vote on 17 October 2019, in which the plan failed to garner the requisite 67% or more vote. On 5 November 2019, the resolution professional informed the Committee of Creditors that the consortium of Haldiram Snacks and Pioneer Securities wanted to revise their offer. However, the CoC declined to reconsider the offer after already having voted against it.
Following that the CoC agreed to liquidate the company, and they re-appointed the resolution professional as the liquidator. The liquidator will have a 90-day period to try and sell the Kwality Ltd as a going concern after which the assets of the company will be sold piecemeal.
The insolvency proceeding against Kwality Ltd was initiated by KKR India Financial Services Ltd for failing to pay an outstanding due of Rs 32.73 crore.
Also See: Kwality Ltd now under CBI net for duping banks of Rs 1,400 crore
Overall, the company owed close to Rs 2,000 crore to different financial creditors and Rs 104 crore to operational creditors. Kwality Ltd. was incorporated in 1992 as Kwality Dairy (India) Ltd. The company was set up as a backward integration unit of Kwality Ice Creams India Ltd and was acquired by Dhingra Family in 2002.
