Sintex Industries' lenders plan Swiss challenge auction for textile business
Textiles business Sintex Industries’ lenders are planning to hold a Swiss challenge auction if the current bidders on the bankrupt business do not significantly improve their offers.
In order to prevent Sintex from going into liquidation, the business’ lenders are looking for ways to encourage bidders to substantially increase their offers for purchase.
“Only if the offers are not improved substantially, the lenders will consider the auction route instead of voting for liquidation,” an anonymous source told the Economic Times about the lenders’ plans.
Sintex currently has four bidders with Reliance Industries’ ACRE team having offered the most for the business with an offer of Rs 2,363 crore. Textile business Welspun’s Easygo Textile has offered Rs 2,300 crore and Himatsingka Ventures and GHCL have also placed slightly smaller bids. However, the lenders have not deemed any of these bids sufficient.
A Swiss challenge system sees an entity publish a bid made upon it and invite third parties to either match the bid or submit a higher bid. When the Reliance Industries ACRE team bid was made earlier in the month, Sixtex Industries’ resolution professional Pinakin Shah had asked bidders to submit improved offers and resolution plans for the business but this has yet to happen, according to the source.
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