Amtek Auto asks court to decide on Liberty’s eligibility

MUMBAI: The resolution professional of Amtek Auto has asked the bankruptcy court to decide on the eligibility of Liberty House or give him one week’s additional time to negotiate with the second highest bidders after it came to light that Liberty House is deemed ineligible for non-payment of dues of Exim Bank. Lenders had voted in favour of Liberty House for bankrupt Amtek Auto after it emerged as the highest bidder offering about Rs 4,334 crore.
Soon after the RP proposed to the Chandigarh bench of bankruptcy court the resolution plan of Amtek Auto, it emerged that the company has not paid $3 million to Exim Bank. This came to light when the resolution professional of ABG Shipyard rejected a bid by Liberty House on the grounds that it is ineligible as per Section 29A of the Insolvency and Bankruptcy Code which bars defaulters from bidding for bankrupt companies.

Amtek Auto’s resolution professional, Dinkar Venkatasubramanian had sought time to negotiate with second highest bidder - Deccan Value. Amtek Auto had received only two binding bids-Liberty House and Deccan Value.

ABG Shipyard, on the other hand, received bid only from Liberty House. Senior officials said that Liberty House has cleared their dues with Exim Bank after the institution informed the RP of ABG Shipard, Sunderesh Bhat about their overdues from Liberty House. This could not be independently verified from Exim Bank. They will present to the Chandigarh bench that they have cleared dues when it comes up for hearing, said senior officials quoted above.

Liberty House is also set to challenge the move by RP to deem them as ineligible before giving them an opportunity to clear the dues. ABG Shipyard and Amtek Auto are among the list of 12 companies that the Reserve Bank of India had directed banks to refer to the bankruptcy court. ABG Shipyard is facing claims of Rs 18,245 crore while Amtek Auto is facings claims of Rs 12,722 crore from financial creditors.