Patanjali Ayurved has entered the competition to acquire the financially troubled Rolta India with a belated all-cash bid of approximately INR 830 crore. This move comes shortly after Ashdan Properties from Pune was declared the leading bidder by banks last week.
Earlier this week, it petitioned the Mumbai bench of the National Company Law Tribunal to instruct lenders to review its bid. During a Thursday hearing, in response to Ashdan Properties’ objection, the bench delegated the responsibility to the committee of creditors to determine whether the offer should be considered, given that it was submitted after the conclusion of the bidding process.
“The offer is between INR 820 crore and INR 830 crore and is much better than what lenders had in hand so far because it is all upfront and comes from a cash-rich company. This is a happy problem for lenders to have but they have to now decide how to proceed further,” a person familiar with the matter said on condition of anonymity.
Lenders are currently evaluating the option of starting a new process, seeking legal opinions, as the plans were submitted last month and the highest bidder has already been determined, according to insiders.
“This is a strong bid and will have to be considered since it offers better value. Since the plans have not been voted on, lenders are within their rights to call for fresh interest and seek plans from all bidders in a new process to give all an equal opportunity,” said a second person.
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Patanjali Ayurved spokesperson SK Tijarawala said, “We have approached the competent authorities and will submit a plan when permitted. We have evaluated the options and have made the decision after due consideration.”
He declined to provide reasons for the consumer company’s interest in a technology firm.
Kamal Singh-promoted Rolta India, a defense-focused software company, entered the bankruptcy process in January 2023. The company owes INR 7,100 crore to banks, primarily led by Union Bank of India (UBI), and an additional INR 6,699 crore to unsecured foreign bondholders, primarily led by Citigroup, resulting in a total debt of close to INR 14,000 crore.
According to a report on January 29, Ashdan Properties had proposed INR 760 crore on a net present value (NPV) basis, amounting to less than 6% recovery on the total debt. This would result in approximately 11% recovery for secured financial creditors, led by Union Bank of India.
Unlike Ashdan Properties’ bid, Patanjali Ayurved’s offer is entirely upfront and does not involve any deferred payment, potentially leading to a higher valuation. Priced at INR 830 crore, it provides nearly 12% recovery for secured creditors.
“Patanjali, like others, could be looking at Rolta’s real estate, especially in Mumbai, or maybe also the tax gain this acquisition brings because Rolta’s accumulated losses will give it a straight gain,” said a third person privy to the discussions. “But Patanjali Ayurved is also building a mobile application called OrderMe for home delivery which could also be a reason it is looking for a software company.”
Emails seeking comment from resolution professional Mamta Binani and process advisor BOB Capital Markets went unanswered.
The committee of creditors is set to meet next week to decide its next course of action after seeking legal opinion.
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