Dalmia Bharat draws closer to taking over Birla Tyres
Dalmia Bharat group is set to acquire Birla Tyres after creditors approved their resolution plan that proposes partial repayment of ₹1,100 crore of bank loans of the BK Birla group company undergoing insolvency proceedings at the National Company Law Tribunal (NCLT), according to sources aware of the matter.
The resolution offer made by Dalmia Bharat Refractories was cleared by over 75% of creditors of Birla Tyres, well past the two-thirds majority threshold mandated under the Insolvency and Bankruptcy Code for approval of revival plans of stressed companies.
Axis Bank leads the group of creditors. Voting on the resolution plan concluded last week.
ET had first reported on August 19 that Dalmia Bharat had submitted a revised plan for Birla Tyres.
The resolution proposes to repay around ₹300 crore of Birla Tyres' debt.
Lenders were informed that efforts would be made by the acquirer to revive the tyre company, which makes tyres for the commercial and two-wheeler segments, according to the sources cited earlier.
Dalmia Bharat's initial offer to creditors, which was rejected, promised to repay less than a tenth of the company's debt.
Dalmia Bharat declined to comment when contacted. Birla Tyres' resolution professional Pratim Bayal did not respond to ET's queries.
As a next step, the resolution plan will be taken to the NCLT for its approval, as per sources in the know.
Dalmia Bharat Refractories has roped in Kolkata-based Himadri Speciality Chemicals as a strategic partner in the deal.
Birla Tyres was spun off from Kesoram Industries in 2019.
Over two dozen expressions of interest were received by applicants interested in proposing a debt resolution for Birla Tyres.
