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Divi’s, Gland, Fidelity enter race to buy Orchid Pharma

Mar 02, 2019, 11.22 AM IST
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The RP had sought directions from Ingen as no money came according to the terms of the plan and a monitoring committee was not formed.

Highlights

  • Orchid Pharma knocked on the doors of NCLT after its ballooning debt resulted in defaults on interest payments
  • The resolution professional (RP) and the committee of creditors (CoC) accepted a bid by Ingen Capital, asking the potential buyer to bring in Rs 1,060 crore. Of this, it was to pay Rs 334 crore upfront
(This story originally appeared in on Mar 02, 2019)
CHENNAI: The Chennai bench of the National Company Law Tribunal (NCLT) has shot down a proposal by Ingen Capital to take over Orchid Pharma after it failed to bring in the requisite money. The bench also ordered the entire process to restart with fresh deadlines.

The move comes even as Divi’s Laboratories, Gland Celsus Bio Chemicals and Fidelity Trading Corporation have evinced preliminary interest to take over the beleaguered bulk cephalosporin drugmaker. Other bidders keen to acquire Orchid include financial investors Everstone, Piramal Capital, AION Capital, ART Capital and Finquest Group.

Orchid Pharma had knocked on the doors of NCLT after its ballooning debt resulted in defaults on interest payments. A consortium of 24 banks have lent more than Rs 3,200 crore to Orchid. The resolution professional (RP) and the committee of creditors (CoC) accepted a bid by Ingen Capital, asking the potential buyer to bring in Rs 1,060 crore. Of this, it was to pay Rs 334 crore upfront.

Since the investor continued to buy time and sought postponement of financial obligations, the NCLT bench annulled the process. The RP had sought directions from Ingen as no money came according to the terms of the plan and a monitoring committee was not formed. But Ingen allegedly “disappeared without a clue”.

Ingen had sought to raise funds from JM Financial, but couldn’t do so. Ingen CEO Umesh Bhatia declined to comment.

The RP has informed the NCLT bench about other investors keen to buy the company. The bench said in its order, “The RP has also mentioned that he has received emails from Divi’s La boratories, Gland Celsus Bio Chemicals and Fidelity Trading Corporation. Apart from this, he has also submitted that he has received oral enquiries from ART Capital, Everstone Group, AION Capital, Piramal Capital and Finquest Group, expressing interest in proposing resolution plans.”

“In view of the submissions made by the RP and on perusing the order passed by the NCLAT ...in all probability this company would be saved from the death warrant, ie, order of liquidation,” the order added. “It is a company doing wonderful business and providing life to 1,500 employee families,” the order said.

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