Vadraj Cement transferred to NCLT for debt resolution
Cement

Vadraj Cement transferred to NCLT for debt resolution

Vadraj Cement, previously entangled in a prolonged liquidation process lasting over five years within the jurisdiction of the Bombay High Court, has now been transitioned to the National Company Law Tribunal (NCLT) for debt resolution. This move offers a glimmer of hope to creditors seeking to recover over half of their outstanding dues.

In a recent ruling, the NCLT granted approval for the inclusion of Vadraj Cement, formerly known as ABG Cement, in the corporate insolvency process. Lenders have indicated that entities such as Adani Group, UltraTech Cement, and JSW Cement may express interest in bidding to acquire the financially burdened company.

The Bombay High Court had initially ordered the winding up of Vadraj Cement on August 23, 2018, in response to a case involving Beumer Technology versus Vadraj Cement. However, the high court later revoked the winding-up order on August 18, 2023, following a plea by JC Flowers Asset Reconstruction Company (ARC). As part of the proceedings, EY-backed Pulkit Gupta was appointed as the interim resolution professional by the NCLT. The tribunal instructed Chandan Kumar, the official liquidator, to transfer possession and control of all Vadraj Cement assets to the IRP, with a directive to cooperate fully.

Vadraj Cement, a subsidiary of ABG Shipyard, has been entwined in a complex scenario, as its parent company, ABG Shipyard, also underwent a corporate insolvency process. Despite attempts, ABG Shipyard failed to attract bidders, leading to the eventual liquidation and sale of its assets to Welspun Group and Arcelor Mittal.

ABG Shipyard faces allegations of bank fraud, with investigative agencies claiming that Rishi Agarwal, the promoter, diverted bank loans to overseas tax havens. Under the Prevention of Money Laundering Act, the Enforcement Directorate has attached assets worth Rs 952 crore belonging to Vadraj Cement.

It is noteworthy that the NCLT order disclosed objections from the official liquidator (OL) against admitting the company for debt resolution under the Insolvency and Bankruptcy Code process.

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Vadraj Cement, previously entangled in a prolonged liquidation process lasting over five years within the jurisdiction of the Bombay High Court, has now been transitioned to the National Company Law Tribunal (NCLT) for debt resolution. This move offers a glimmer of hope to creditors seeking to recover over half of their outstanding dues. In a recent ruling, the NCLT granted approval for the inclusion of Vadraj Cement, formerly known as ABG Cement, in the corporate insolvency process. Lenders have indicated that entities such as Adani Group, UltraTech Cement, and JSW Cement may express interest in bidding to acquire the financially burdened company. The Bombay High Court had initially ordered the winding up of Vadraj Cement on August 23, 2018, in response to a case involving Beumer Technology versus Vadraj Cement. However, the high court later revoked the winding-up order on August 18, 2023, following a plea by JC Flowers Asset Reconstruction Company (ARC). As part of the proceedings, EY-backed Pulkit Gupta was appointed as the interim resolution professional by the NCLT. The tribunal instructed Chandan Kumar, the official liquidator, to transfer possession and control of all Vadraj Cement assets to the IRP, with a directive to cooperate fully. Vadraj Cement, a subsidiary of ABG Shipyard, has been entwined in a complex scenario, as its parent company, ABG Shipyard, also underwent a corporate insolvency process. Despite attempts, ABG Shipyard failed to attract bidders, leading to the eventual liquidation and sale of its assets to Welspun Group and Arcelor Mittal. ABG Shipyard faces allegations of bank fraud, with investigative agencies claiming that Rishi Agarwal, the promoter, diverted bank loans to overseas tax havens. Under the Prevention of Money Laundering Act, the Enforcement Directorate has attached assets worth Rs 952 crore belonging to Vadraj Cement. It is noteworthy that the NCLT order disclosed objections from the official liquidator (OL) against admitting the company for debt resolution under the Insolvency and Bankruptcy Code process.

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