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Bain-Backed Group Is Poised to Win Binani Cement Stake

Updated on
  • Dalmia Bharat consortium offered 20 percent stake to lenders
  • Indian authorities push to clean up $210 billion stressed debt

An investor group backed by Bain Capital is poised to win the bidding for India’s Binani Cement Ltd., which is being sold under the country’s insolvency process, people with knowledge of the matter said.

The consortium led by Dalmia Bharat Ltd., which was competing with billionaire Kumar Mangalam Birla’s UltraTech Cement Ltd., made a bid of about 63.5 billion rupees ($980 million), the people said Tuesday. Insolvency resolution officials were slated to reach an agreement with Dalmia Bharat as early as Tuesday evening, according to the people, who asked not to be identified because the information is private.

The Dalmia Bharat consortium’s proposal includes offering about a 20 percent stake in Binani Cement to its lenders, the people said. Arpwood Capital Pvt is advising the investor group, the people said.

Shares of Binani Cement’s Mumbai-listed parent company, Binani Industries Ltd., jumped as much as 5 percent Wednesday and were on track to close at the highest level in more than a month. The benchmark S&P BSE Sensex fell 0.5 percent at 9:47 a.m. in Mumbai, while Dalmia Bharat shares rose as much as 1.5 percent.

A successful sale may lure buyers for assets in Asia’s third-largest economy as authorities push lenders to clean up $210 billion of stressed debt. The central bank has already asked commercial lenders to resolve bad loans of the 40 biggest defaulters within a year as overdue borrowings hamper fresh investment and slow economic growth.

Dalmia Bharat made a joint offer with India Resurgence Fund, which is backed by Bain Capital Credit and local conglomerate Piramal Enterprises Ltd., people with knowledge of the matter said earlier.

A spokeswoman for Dalmia Bharat declined to comment, while a representative for Binani Cement didn’t immediately respond to messages seeking comment. A representative for India Resurgence Fund couldn’t immediately comment.

(Updates with share moves in fourth paragraph.)
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