Case Study

Second round of e-auction for the sale of Punj Lloyd on August 28, 2023

Punj Lloyd was forced into bankruptcy after being taken to NCLT by ICICI Bank in March 2018 for failing to make a payment of Rs 854 crores. The Company owed a total of Rs 13,386 crore to 1097 creditors, including both financial and operational creditors. The NCLT, thereby, acknowledged ICICI Bank's insolvency petition against the Company, initiated insolvency proceeding against the Company. However, as no resolution was approved by the Committee of Creditors, the NCLT initiated Liquidation Process that is still ongoing.

The 1st E-auction for the sale of Punj Lloyd as a going concern was held on July 10, 2023, but it failed to attract any bids from potential acquirers. The 2nd round of the e-auction is scheduled to be held on August 28, 2023, from 11 am to 6 pm by the company's liquidator - Ashwini Mehra. All interested bidders have been requested to submit their Expressions of Interest along with requisite eligibility documents on or before August 8, 2023.

The Reserve Price for the call of bids for the second round of e-auction has been fixed at Rs. 1,061 Crore. The interested bidders are expected to submit an amount of Rs. 10 crores as an earnest money deposit to place their bid at the e-auction.

After the Company was pushed to insolvency in 2018, the consortium of Payard Investments Private Ltd and Prudent ARC Ltd filed a final resolution plan for Punj Lloyd. However, the Committee of Creditors rejected the resolution by a voting percentage of 79.53%. Thereafter, in March 2021, the Committee of Creditors decided to liquidate Punj Lloyd and sell the company as a going concern because the Company had over 3,000 employees and several active EPC projects, thus the resolution professional, Ashwini Mehra, requested the Delhi bench of the NCLT to issue an order to liquidate the Company as a going concern.