- In the ongoing insolvency process, sources said, the Delhi-based Haldiram group has emerged as the sole bidder to acquire debt-ridden dairy company Kwality with an offer of around Rs 130 crore.
- Kwality Dairy did post a loss of Rs 1,500 crore in the quarter ended December.
In the ongoing insolvency process, sources said, the Delhi-based Haldiram group has emerged as the sole bidder to acquire debt-ridden dairy company Kwality with an offer of around Rs 130 crore.
The lenders are likely to vote on Haldiram’s bid later this month, they added.
Shailendra Ajmera, who is part of a global consultancy firm EY, has been named as the specialist resolution to manage the insolvency proceedings, which began in December 2018 following an order of the National Company Law Court (NCLT).
KKR, a major private equity company, filed a lawsuit against Kwality for insolvency.
Kwality raised Rs 300 crore from KKR India Financial Services in 2016 and received Rs 220 crore’s additional investment. To finance its expansion plans and reach the product market, the amount was increased.
On Wednesday, the Committee of Creditors (CoC) met to review the settlement process and discuss the appraisal report.
Haldiram has emerged as the only bidder for the purchase, according to sources. In the third week of October, the CoC will vote on the resolution proposal.
Kwality has a total debt of about Rs 1,900 crore, which means that a major haircut would have to be taken by creditors.
The company deals with milk production and dairy products manufacturing, including ghee, milk powders, lassi, chaach, and flavored milk. Two milk processing units are operated by it, one in Softa, Haryana, and one in Dibai, Uttar Pradesh.
Several major companies that had earlier shown interest in the ailing dairy product maker initially included Aion-affiliate Arcion Revitalisation, TPG Capital, IndiaRF — a JV between Piramal Enterprises and Bain Capital, India Resurgent Fund and JK Group’s LVP Foods. But, only Haldiram did finally submit a binding bid.
Kwality Dairy, established in 1992, can process about 3 million liters of milk per day, according to data on its website. It has six production units, says the website, spread across Uttar Pradesh, Haryana, and Rajasthan.