The move is intended to block lenders decision to hand over Binani to Dalmia Bharat
In a fresh twist to the auction of Binani Cement, UltraTech Cement on Monday announced it is set to buy Binani's stressed assets after its board agreed to issue a 'comfort letter' providing Rs 7,266 crore to Binani's parent.
The latest move comes after the Aditya Birla Group company had alleged lack of transparency in the proceedings to auction Binani Cement, which was referred to the National Company Law Tribunal after accumulating debts of Rs 5,000 crore.
In a meeting held on March 16, the Committee of Creditors had approved the plan presented by Dalmia Cement, dealing a blow to UltraTech's plans.
According to reports, Dalmia had bid Rs 6,350 crore to Binani's lenders, and had also offered an equity of 20 percent.
"Binani Industries...has approached the Company for arranging funds to pay-off the lenders," UltraTech said in a statement to Bombay Stock Exchange on Monday. In return, the country's largest cement maker will purchase 98.47 percent in Binani Cement.
But the deal is subject to termination of the auction proceedings under the Insolvency and Bankruptcy Code.
"The Board... has agreed to issue the comfort letter confirming that the company will provide funds amounting to Rs 7,266 crore, being the amount it had offered the Committee of Creditors..."UltraTech had earlier alleged its offer was turned down despite being higher after a revision.