abg shipyard: Welspun Corp wins tender for ABG shipyards

Welspun Corp became the winning bidder for distressed borrower ABG Shipyard in an auction for consideration of ₹659 crore. Welspun Corp and its subsidiary Nauyaan Shipyard would acquire the ABG asset in Dahej, Gujarat. The asset spans 165 acres of leasehold land with 1,000m of water frontage.

Once owned by Rishi Agarwal, ABG Shipyard is in liquidation after lenders failed to find a buyer amid insolvency proceedings. It is among the original 12 companies that the Reserve Bank of India (RBI) ordered lenders to take to bankruptcy court for resolution.

In an order dated August 26, the Supreme Court ordered the liquidator of ABG Shipyard to complete the sale of specific assets of the company within four weeks from the date of the order. Welspun and its subsidiary, which emerged as the successful bidder, paid a purchase consideration of ₹659 crore on September 21, a notice to exchanges said.

Welspun has offered to use ABG Shipyard’s facilities for defense and commercial shipbuilding, green steel, ship demolition and repair, among others.

In a separate statement to the media, the Enforcement Directorate (ED) said it had attached shipyards, farmland, commercial properties and bank deposits worth ₹2,747 crore. The assets are seized following allegations of bank loan fraud which are under investigation.

The notice of seizure was delivered to the liquidator shortly after he issued a certificate of sale for the transfer of the specific assets to the winning bidders.

In a statement to the stock exchange, Welspun said it “proposes to take appropriate action in light of the foregoing, including the immunity available for specified assets sold in liquidation.” He further stated that the Notice of Seizure is being issued even though provisions of the Insolvency and Bankruptcy Code prohibit investigative agencies from seizing or confiscating debtor company property sold as part of the assets. of liquidation.

On Tuesday, the Central Bureau of Investigation (CBI) arrested ABG shipyard developer Rishi Agarwal on a money laundering allegation. The company had claims of ₹22,059 crore from verified creditors.

Agarwal was arrested following a complaint filed by the State Bank of India, which had an outstanding loan of over ₹2,400 crore.

The CBI said in a statement that the company would have transferred funds raised from banks to its related parties. The money was invested in an overseas subsidiary to purchase assets on behalf of its related parties, the CBI said.

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