Dalmia Bharat Cement was declared the higher bidder after it offered close to Rs6,400 crore in upfront cash payment to the lenders of distressed Binani Cement. Photo: HTMumbai: Creditors are driving hard bargains with potential suitors of distressed assets in the ongoing corporate insolvency cases, preferring resolution plans that offer upfront cash payments over those that include a higher proportion of equity. In a similar situation, Dalmia Bharat Cement was declared the higher bidder after it offered close to Rs6,400 crore in upfront cash payment to the lenders of distressed Binani Cement. “While for banks upfront cash payment is the ideal situation, evidently this has also led to a decline in buyer interest to some extent,” said Sajid Mohamed, partner, Agrud Partners, a Mumbai-based corporate law advisory firm. Industry watchers say that high upfront cash payment may be feasible for buyers in situations where the net replacement value of an asset exceeds the price at which it is available.

Source: Mint April 01, 2018 21:33 UTC