At an auction, Welspun Corp. won the offer for the shipyard of insolvent borrower ABG Shipyard Limited for a sum of INR 6.59 billion. The ABG asset in Dahej, Gujarat, would be purchased by Welspun Corp. and its subsidiary, Nauyaan Shipyard Private Limited. The asset is situated on 165 acres of leasehold land that has 1,000 meters of waterfront. ABG Shipyard, which was once owned by Rishi Agarwal, is currently being liquidated by lenders after they were unable to find a buyer through insolvency proceedings.
It is one of the first 12 companies that the Reserve Bank of India (RBI) instructed lenders to send to the bankruptcy court. In an order dated August 26, the Supreme Court ordered the liquidator of ABG Shipyard to complete the sale of certain corporate assets within four weeks of the date of the order. The winning bidder, Welspun, and its subsidiary paid INR 6.59 billion in purchase consideration on September 21, according to a notice to the stock exchanges.
Welspun has suggested employing ABG Shipyard’s facilities for a variety of purposes, including green steel production, ship breaking, ship repair, and commercial and defence construction. The Enforcement Directorate (ED) stated it had attached shipyards, farmland, businesses, and bank accounts totaling INR 27.47 billion in a separate statement to the media. The assets have been attached following charges of bank loan fraud that are being looked into.
Soon after the liquidator issued a sale certificate transferring the specific assets to successful bidders, the attachment notification was sent to him. Welspun proposed to “take necessary measures in light of the above, including the immunity applicable to the identified assets sold under liquidation,” according to a statement it submitted to the exchange. It further stated that despite the Insolvency and Bankruptcy Code’s prohibitions against investigating agencies confiscating or seizing corporate debtors’ properties sold as part of liquidation assets, the attachment notice was still issued.
