The National Company Law Tribunal has cleared a resolution plan submitted by Dhanuka Laboratories Ltd to acquire debt-laden drugmaker Orchid Pharma Ltd.
A Chennai bench of the bankruptcy court approved Dhanuka’s offer on Tuesday, Orchid said in a stock-exchange filing.
The NCLT’s decision follows the approval of Dhanuka’s offer by Orchid’s lenders earlier this month.
Dhanuka Laboratories had emerged as the highest bidder for the debt-laden company on June 11. However, just before e-voting by the committee of Orchid’s creditors was to close, Punjab National Bank (International) Ltd changed its vote and opposed the proposal.
Dhanuka's resolution plan had initially received a favourable vote by the committee of creditors with 67.07% voting share. The PNB unit later changed its decision, resulting in the vote share falling below the required 66%. This had prompted Accord Life Spec, another bidder, to approach the NCLT.
However, the NCLT ruled in favour of Dhanuka’s offer.
Last month, VCCircle had reported that Dhanuka and Covalent Laboratories Pvt. Ltd were among the three applicants which had been shortlisted to acquire Orchid. Dhanuka had an edge over the others given its prominence in the industry.
Chennai-based Orchid was among the 28 large corporate defaulters in the Reserve Bank of India’s second list of debt-laden companies that were referred for insolvency in August 2017. It owes a total of Rs 3,200 crore to a consortium of 24 banks. The lenders will get Rs 1,116 crore as per Dhanuka’s offer.
Dhanuka’s offer is lower than that of Ingen Capital, which had last year emerged as the winner of the race process to acquire Orchid with a bid of Rs 1,490 crore. However, Ingen later failed to make the payment. This prompted a second round of bidding for the drugmaker.
Gurugram-based Dhanuka Laboratories is part of a group that also has business interests in agrochemicals and pesticites. The company was set up in 1998. It makes active pharmaceutical ingredients, drugs in semi-finished dosage and intermediates, its website shows. Hyderabad-based Covalent, too, makes APIs, or bulk drugs, and intermediates.
