NEW DELHI: Shares of Alok Industries climbed 5 per cent in Thursday's trade on reports that Reliance Industries is set to acquire the company.
A majority of lenders to the bankrupt textile company have voted in favour of the resolution plan given by billionaire Mukesh Ambanis company, two officials familiar with the development told ET.JM Financial ARC had bid, in partnership with Reliance Industries, for Alok Industries, making all cash offer in the range of 15-20 per cent of outstanding loan, they said.Tracking the development, the stock hit a 5 per cent upper circuit at Rs 4.24 on BSE around 10.15 am (IST).The offer is marginally higher than the liquidation value of the company and that is the reason banks are willing to vote in favour, one of the officials said.The liquidation value of the company is pegged at Rs 4,200 crore while the offer is in the range of Rs 4,500-5,000 crore, the sources said.
There is no equity upside for lenders under the proposal given by JM Financial ARC and Reliance.Alok Industries has received claims of Rs 29,500 crore from lenders with State Bank of India being the lead bank.
On Wednesday, the resolution professional had held a meeting of committee of creditors to vote for the resolution plan.