The Kolkata bench of the National Company Law Tribunal (NCLT) set a rare precedent in the second week of May by allowing a bidder who was unsuccessful twice to make a fresh bid, resuming a two-way contest between the top bidders for a 197-room hotel in Kolkata.
The highest bidder, Shri Ram Residency Pvt. Ltd, immediately moved the appellate tribunal in Delhi, which ordered the resolution professional to receive fresh bids but keep them under wraps until the appeal has been dealt with. The bench ordered the two bidders to submit their bids. Their revised bids are to be reviewed and a resolution plan finalised and submitted with the bench by 25 May.
Shri Ram Residency had offered around Rs115 crore for the property, which is managed by the Taj group under the Gateway brand, said Shourya Mandal, partner, Fox and Mandal, a law firm representing the bidder.
After Shri Ram Residency beat RDB Realty and Infrastructure Ltd twice in bidding, the latter moved the Kolkata bench of the tribunal seeking an opportunity to bid again. Resolution professional Kuldeep Verma opposed the petition.
Legal counsel for Shri Ram Residency, Ratnanko Banerji, had objected to fresh bidding, claiming that it would be disruptive for the process of insolvency resolution.
However, the tribunal held that because the lenders had not cleared Shri Ram Residency’s bid as the most optimal resolution plan, fresh bids should be received for better realisation of value from the asset.
Jalan Intercontinental Hotels Pvt. Ltd, which owns the property, has dues of around Rs170 crore. Edelweiss Asset Reconstruction Co. Ltd, which took over State Bank of India’s Rs127 crore loan to the company, moved the tribunal and the matter was admitted for insolvency resolution in August last year.
The same bench had last week allowed the resolution professional of Binani Cement Ltd to receive fresh bids from UltraTech Cement Ltd, after it lost out to Dalmia Bharat Ltd in bidding. Though there are similarities, the two matters have sharp differences, according to Mandal.
UltraTech said it did not get a second chance despite offering a substantially higher price than Dalmia Bharat. In the hotel case, however, the competing bidder, RDB Realty, was outbid twice, said Mandal.
Source: Livemint, May 24, 2018