A consortium of Dalmia Bharat Refractories and Himadri Speciality Chemicals has won the approval of the Calcutta bench of the National Company Law Tribunal to revive ailing Birla Tyres.

The revival plan submitted by the two companies had received the approval of the committee of creditors of Birla Tyres, which belongs to the Basant Kumar Birla Group of companies, with a vote share of 82.48 per cent. The plan was then submitted to the NCLT, Calcutta for approval.

The plan value submitted by Delhi-based Dalmia Bharat and Calcutta-based Himadri is Rs 347.03 crore, higher than the liquidation value of Rs 335.1 crore. Birla Tyres owes Rs 1,132.43 crore to the financial creditors as of March 16.

Birla Tyres used to be a division of Kesoram Industries, the flagship of the BK Birla group, before it was spun off to a separate listed entity, was admitted for the corporate insolvency resolution process on May 5, 2022.

The Kesoram management had been looking to fix the tyre business for years but a turnaround remained elusive. In 2016, it sold off the more modern Haridwar unit to JK Tyre for Rs 2,195 crore to pare debt and retained the older Balasore plant in Odisha.

With an eye on entering the passenger radial car tyre segment, it was planning to set up a unit which has remained unfinished. The unit was later spun off with the hope of attracting a strategic partner but the plan did not work out.

‘Birla’ name

Kesoram Industries and Manav Investment & Trading Company, a promoter group company of Kesoram and Birla Tyres, objected to the resolution plans on various grounds, including the use of the Birla family name.

Kesoram objected to the rejection of its claim of about Rs 518 crore. The NCLT bench comprising Bidisha Banerjee, judicial member, and Arvind Devanathan, technical member, dismissed the objections and upheld the plan submitted by Dalmia-Himdri, who were represented by Aquilaw.