Binani Cement's Massive Debt - Banks to Sell Loans to ARC

Binani Cement delisted in 2011 at the Exit price of Rs 90 /-

http://www.business-standard.com/article/companies/binani-cement-delisted-from-bourses-111053100205_1.html

It appears , now , nearly all the Equity is with the holding company of Braj Binani , Binani Industries ( Listed ).





It seems Binani Cement , because of its massive debt ( reportedly Rs. 3500 crore ) is in deep trouble.

Annual Report ( 2014 -15 ) of holding Company Binani Industries states :-

BCL suffered major setback in its performance due to poor demand
 scenario that prevailed in the Cement Industry owing to reduced
 activities in Infrastructure and Real Estate sectors. The situation was
 further aggravated due to certain coercive actions initiated in the
 last quarter of FY''14, by the Rajasthan VAT Authorities (RVAT), in
 connection with all past dues which were earlier in dispute. This lead
 to intermittent stoppage of production and dispatches of cement
 Furthermore, liquidity constraints have also affected the smooth
 operations of BCL. BCL has paid Rs. 278 crore to the RVAT authorities
 during February 2014 to September 2015. BCL has been sanctioned a
 restructuring package by the lenders in the Joint Lenders Forum for
 funding the sales tax liability. Lenders'' have disbursed only part of
 the sanctioned amount. Immediate disbursement of the entire sanctioned
 loans will facilitate settling of issues with the RVAT authorities and
 normalization of operations

http://www.moneycontrol.com/annual-report/binaniindustries/directors-report/BI10#BI10

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Earlier , attempts were made to restructure debt ( by converting in to Equity ) or finding a new Promoter ( MNC ). But no progress.


"People close to the development said Binani Cement was also approached by a multinational for an acquisition------. 

http://articles.economictimes.indiatimes.com/2015-11-06/news/68071364_1_binani-cement-braj-binani-group-total-debt.

Now , the Banks have sold off their Loans to Binani Cement to ARC ( Asset Reconstruction Companies )


"
After failed restructuring efforts, banks are in the process to sell off loans of Binani Cement to asset restructuring companies (ARCs), sources say. The company has debt to the tune of Rs 3,500 crore. 

Read more at:.

http://www.moneycontrol.com/news/cnbc-tv18-comments/banks-to-sell-off-binani-cement39s-loans-to-arcs-sources_5000501.html


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Binani Cement Official Site :-

http://binaniindustries.com/our-business-areas/cement/

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http://www.rareindianshares.info/2009/06/binani-metals-limited.html

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new post

June 11, 2017

Binani Cement to Issue Shares @ Rs.185/53p in Loan Restructuring

Binani Cement delisted in 2011 at the Exit price of Rs 90 /-

It has massive debt.

The Banks  sold off their Loans to Binani Cement to ARC ( Asset Reconstruction Companies ).

Binani Cement , now , has finalised debt restructuring.

As part of the bigger deal ,Binani Cement  would issue around 2 crore 18 lakh ( 2,18,50,536 ) shares of Rs.10 each  to Asset Reconstruction Companies led by Edelweiss ARC @ Rs.185/53 p each.

Post issue the percentage of Promoters' holding will fall to 88: 21 % from current 98:43 %.

( It means when 10:22 % stake is being valued at around Rs.406 cr, the enterprise value of Binani Cement ( Unlisted is around Rs.4000 cr )- Please Recheck this point.  

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General Warning : Investment in shares can be injurious to your WEALTH.

Caution :The blog writer has personal/ family members' holdings in this company ,so please make suitable "provisions " for likely over optimism

( PS : All information given in good faith. Please recheck all facts etc. No responsibility with this author / blog. )