The sale of bankrupt Sical Logistics Limited (BSE:520086), under the Insolvency and Bankruptcy Code (IBC) has attracted 26 bidders, but potential buyers are spooked by a lenders' decision to pull out two key subsidiaries and sell them separately mid-way through the process. Just a fortnight before the bidders, including Allcargo Logistics Limited (BSE:532749) and Pristine Logistics & InfraProjects Pvt. Ltd., were asked to file a resolution plan for Sical Logistics, the resolution professional launched a separate auction process in September 2021 for the sale of entire equity interest of 53.6 % held by Sical Logistics in Sical Infra Assets Ltd. and 97.5% in Patchems Pvt.

Ltd., according to a document seen by BusinessLine. The 26 eligible bidders for Sical Logistics as well as other bidders are allowed to participate in the all-cash auction process for the sale of equity in the two subsidiaries, which was approved by the committee of creditors. The move led to protests from qualified bidders for the corporate insolvency resolution process (CIRP) of Sical Logistics, with one of them filing a petition before the National Company Law Tribunal (NCLT) seeking to reverse it, multiple sources with knowledge of the matter said.

“The resolution process of Sical Logistics will lose its charm if the stakes in subsidiaries are sold separately,” said a source. “These are significant subsidiaries. Why would anybody be interested in the resolution process of Sical Logistics at the corporate level,” he said.

“The subsidiaries are part of the parent company Sical Logistics. Let the resolution process for the parent get over. If that fails, they can go for auction or liquidation.

But why should they derail bidders who are interested in the ongoing resolution process of Sical Logistics as a going concern,” the source asked. “The best way to revive Sical Logistics is through a resolution plan for the company as a going concern,” he said.