No takers? 3rd time in 5 yrs auction call for Daewoo's Greater Noida assets

Mumbai/New Delhi, July 10 With apparently no takers, for the third time five years the real assets of the erstwhile South Korean automobiles major, Daewoo Motors India Ltd (DMIL) in Greater Noida, shall go under the hammer again on August 17.

The auction of the land assets, which were earlier in 2008 taken over by the Pan India Motors, has been ordered by the Debt Recovery Tribunal, III, Mumbai, and hopes to recover a portion of the massive dues of the DMIL

The 204-acres land parcel had gone up for auction in 2019, then 2020 and again in 2023 -- and the latest attempt comes nearly 20 years after the DMIL winded up its India operations in 2003-2004.

The leasehold land pertains to the plot No. A-1, Surajpur Industrial Area, Dadri Road, Greater NOIDA in Gautam Buddha Nagar district of Uttar Pradesh and measures 825,612.23 sq.m., as per the DRT-III Mumbai’s order last Thursday.

"DRT No. III, Mumbai has drawn up the Recovery Certificate for the recovery of Rs 511,02,84,697.00 with interest and costs from the Certificate Debtors and a sum of Rs 159,78,46,40,834.00 (dues till August 2023 filed by ARCIL, and a sum of Rs 134,95,88,21,963.00 (dues till August 2023 filed by SASF, defendant) is recoverable together with further interest, costs and charges as per the Recovery certificate/Decree," said the order.

A notice by the DRT said that the entire property shall be sold in one go at a reserve price of Rs 355-crore, and bidders would have to quote a price higher than this.

The amount by which the bids can be increased will be Rs 4-crore, and in case of any kind of disputes, the property shall at once be put up for re-auction.

Besides the property on auction-sale, the successful bidder shall have to clear the past dues/arrears of nearly Rs 778-crore of the Uttar Pradesh State Industrial Corporation (till March 2023), plus Rs 20-lakhs due to Noida Power Co. Ltd., and additionally, nearly two acres (7,590 sq.metres) of land is encroached upon by one Virendra Anil Bahl without the DRT order.

While the revenue assessed on the property is not known, all the above three disputes are in litigation before courts or various authorities.

The Gurugram-based auctioneer, C1 India Pvt. Ltd. -- has been assigned to execute the auction process between 2-3 p.m. on August 17.

Despite repeated attempts by IANS, the concerned officials declined to comment on the details of the upcoming auction.

As per the DMIL's employees' unions, there were around seven lenders to the company, including State Bank of India, IDBI Bank, ICICI Bank and Yes Bank

The DMIL's assets were put up for sale after a company named Pan India Motors took them over. The Pan India Motors shareholders comprises FirstRand Bank of South Africa, DE Shaw, a global investment and technology development company, the beleaguered IL&FS, Spicejet Chairman and co-Founder Ajay Singh, and ex-Hyundai India President BVR Subbu.

According to employees union members, the new company took over the Indian assets of the DMIL for around Rs 765 crore under a condition that it would turn around the company and continue with the automobile business.

There were higher bidders but the court gave it to Argentum as it was the only company which said it would restructure or restart the automobile business.

The workers also said that whosoever comes in should retain them and restart the factory, and Argentum thus got control of the bankrupt company.

While Argentum Motors was the operating company, while Pan India Motors was the holding company, said an ex-employee.

However, soon it came under flak as some promoters allegedly diverted from the primary objective of manufacturing automobiles and auto components to using its property for earning money. This also led to differences among the promoters.

The company had tie-ups with General Motors (GM), US and manufactured components for the American company, but later GM withdrew from the partnership owing to some accounting differences, sources indicated.