Eagle pipped rivals that included Silvassa-based Geelon Industries and Gujarat-based Gajera Group by offering to bear the ₹25 crore corporate insolvency resolution process (CIRP) costs over and above its offer, people familiar with the details of the plan said.
“Gajera’s bid was actually higher at ₹235 crore but it was riddled with many conditions, primarily that the company will bear CIRP costs only up to ₹5 crore which was the deal-breaker. Lenders were more comfortable with not sacrificing anything due to CIRP costs,” said a person familiar with the plan.
In a notice to the stock exchanges Sumeet Industries said that Eagle Group received 74.90% of the votes. The voting period lasted a month after beginning on October 25. Resolution professional Satyendra Khorania will now move the Ahmedabad NCLT seeking approval for the plan. Khorania did not reply to ET’s email seeking comment.
Sumeet, also based in Surat, has been classified as a non-performing account (NPA) with banks for more than three years. It owes lenders led by Bank of Baroda (BoB) more than ₹900 crore including about ₹530 crore in principal. It was admitted for bankruptcy in December last year, after a failed attempt to restructure its loans. BoB is the largest creditor to the company with a 65% share of the company’s dues to financial creditors, followed by IDBI Bank (21%). Other lenders are Central Bank of India, Canara Bank, Union Bank of India and Germany-based Oldenburgische Landesbank AG. One large lender dissented.
Large bidders like Reliance Industries and Kolkata-based MCPI chose not to bid after initially expressing interest, ET reported in June. The offer by Eagle is a 74% haircut to lenders on their total dues and is just slightly higher than the 43% recovery lenders managed through the ₹225-crore offered by the promoter in a one-time settlement with State Bank of India (SBI) and Tourism Finance Corp of India (TFCI) in fiscal ended March 2022.