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Nikhil Merchant-led consortium wins race for Reliance Naval

Nikhil Merchant-led consortium wins race for Reliance Naval

Anil Ambani-led Reliance Infrastructure's last-minute offer to wrest back control of shipyard rejected by lenders. 

Earlier this week, Anil Ambani's Reliance Infrastructure had launched a twin-pronged effort to try and wrest back control of what was the largest private defence shipyard in India. Earlier this week, Anil Ambani's Reliance Infrastructure had launched a twin-pronged effort to try and wrest back control of what was the largest private defence shipyard in India.

The Hazel Mercantile-Swan Energy consortium has won the bid for Anil Ambani's Reliance Naval. 

The consortium's resolution plan was approved with nearly 95 per cent of the lenders voting in favour by the end of voting late evening today. 

The consortium will shortly be awarded the letter of intent for taking over the bankrupt shipyard, sources have told Business Today TV.

Sources added that the resolution plan of Anil Ambani led Reliance Infra was unanimously rejected by Committee of Creditors. 

The resolution professional of Reliance Naval will soon approach National Company Law Tribunal (NCLT) Ahmedabad for approval of the winning bid. 

Earlier, on Wednesday voting on the resolution plan for the bankrupt Reliance Naval shipyard had crossed the crucial threshold level of a minimum of 66 per cent.

Voting on the bid has been underway since February 24.

This marks a significant milestone in the long-drawn saga of the  resolution process of Reliance Naval which began over 26 months ago to recover over Rs 12,429 crore owed to financial creditors including the State Bank of India and the Union Bank of India among others. 

Earlier this week, Anil Ambani's Reliance Infrastructure had launched a twin-pronged effort to try and wrest back control of what was the largest private defence shipyard in India.

As part of that last-ditch effort, Reliance Infra had moved to torpedo Mumbai-based industrialist Nikhil V. Merchant’s bid by questioning his eligibility to participate in the bidding for Reliance Naval.

Hazel Mercantile's has offered lenders a total of Rs 2525 crore starting with an upfront Rs 25 crore token.

Reliance Infra’s plea to declare the Hazel Mercantile consortium as ineligible to bid was heard by the Ahmedabad bench of the NCLT last  Monday. The NCLT directed the resolution professional of Reliance Naval and Hazel Mercantile to file a response on the issue of maintainability within a week. The court will hear the matter next on March 30.

A consortium of two companies - Hazel Mercantile Ltd and Swan Energy Ltd – has bid around Rs 2,700 crore for the bankrupt shipyard. This bid was accepted by the resolution professional of Reliance Naval after a legal process three months ago.

Under the IBC, a bid for a bankrupt asset can only be accepted once the eligibility is verified. The Hazel Mercantile bid had been accepted on December 13 last year.