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Eagle Group secures Sumeet Industries with ₹231 crore bid

EditorHari G
Published 11/28/2023, 12:25 AM
© Reuters.
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Eagle Group has successfully won the bid to acquire the debt-laden Sumeet Industries, with a majority of lenders, including Bank of Baroda and IDBI Bank approving the acquisition plan. The deal, valued at ₹231 crore, was sealed with a 74.90% affirmative vote from the creditors. The purchase agreement stipulates an upfront payment of ₹203 crore in addition to ₹28 crore in equity. This offer surpassed competing bids by including an extra ₹25 crore to cover the Corporate Insolvency Resolution Process (CIRP) expenses.

The approval came after the conclusion of a month-long voting process which began on October 25, paving the way for Satyendra Khorania to approach the Ahmedabad National Company Law Tribunal (NCLT) for formal endorsement of the plan. The acquisition marks a pivotal turn for Sumeet Industries, which has been grappling with financial woes since last December when a restructuring effort failed. The company has been in arrears of over ₹900 crore, classified as a non-performing asset (NPA) for more than three years.

The decision to accept Eagle Group's offer did meet some resistance; an unnamed lender voted against the majority. Noteworthy is the absence of industry heavyweights like Reliance Industries, which initially showed interest but did not participate in the final bidding. Despite the acquisition resulting in a significant loss for creditors, it offers a marginally better outcome than the previous one-time settlement of ₹225 crore reached in the fiscal year that ended in March 2022.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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