Patanjali Ayurved approached NLCT challenging the decision of Ruchi Soya lenders’ to award the winning bid to Adani Wilmer. Patanjali had also contested in the bidding. The National Court of Law Tribunal (NCLT) will hear the matter on August 27. On Thursday, 97% of the lenders voted in favor of Adani Wilmer.
The claim
Patanjali claims that the bidding process was not properly followed citing conflict of interest. Patanjali questioned the hiring of Cyril Amarchand Mangaldas (law firm) as a legal advisor to Sailendra Ajmera- the resolution professional (RP) and which also serves as the legal council for the winning bidder Adani Wilmer.
The rival bidders
Adani Wilmer is a joint venture between Gautam Adani and Singapore based Wilmer. Adani Wilmer proposed a ₹6,000 cr bid while Patanjali proposed ₹5,700 cr.
On June 16, Ruchi Soya invoked the Swiss challenge bidding process. Under this process, Patanjali was given an option to revise its bid with the winning bid. But instead of producing fresh bids, Patanjali wrote back seeking clarification on the eligibility of Adani Wilmer in the bidding process.
Swiss Bank Challenge
The highest bid (H1) in the first round becomes the base price for other bidders. Other bidders can re quote their bids based on H1. This also includes the highest bidder. All the bidders then enter the second round and the highest bidder in this round is declared the winner.
‘There were a lot of expectations that the IBC would be a quick fix to our NPA. However, the process is getting bogged down in litigation, with bidders dragging each other to court to prove their rivals’ ineligibility and their own eligibility or coming up with superior offers after bids have been opened,’ said a senior Public Sector Bank official to the Hindu Business Line.
About Ruchi Soya
Ruchi Soya is in ₹12,000 cr debt. In December last year, the company entered into the Corporate Insolvency Resolution Process (CIRP) and a RP was appointed. It was initiated by an application filed by the lenders- Standard Chartered Bank, DBS Bank, under the IBC.
Once the lenders choose a bid, the RP must obtain NCLT’s approval.