5 months ago
74
Kolkata Dec 8 (PTI) The National Asset Reconstruction Company (NARCL) on Friday announced the successful acquisition of two SREI companies – SREI Equipment Finance and SREI Infrastructure Finance – under the Insolvency and Bankruptcy Code.
This strategic move sets the stage for the resolution of a significant financial debt amounting to Rs 32,700 crore, NARCL said.
The consolidated resolution plan, as part of the IBC process, promises approximately 50 per cent upfront recovery for the lending consortium, with the potential for substantial upside beyond the committed payment in the resolution plan, a statement said.
N Sundar, MD & CEO of NARCL, expressed his delight at emerging as the successful resolution applicant, terming it one of the largest time-bound resolutions in recent years.
He outlined NARCL’s commitment to reviving SREI’s equipment lending business and working collaboratively with stakeholders to derive optimum value for both entities.
He assured the implementation of a robust business continuity plan to ensure seamless integration, minimizing disruptions, and maximizing efficiency.
The resolution plan received approvals from the National Company Law Tribunal (NCLT), the Reserve Bank of India, and the Competition Commission of India. The Kolkata bench of NCLT had earlier approved the resolution plan in August after the consolidated Committee of Creditors (CoC) endorsed NARCL’s offer with the highest voting among bidders.
NARCL’s offer prevailed over competitors Varde Partners and Arena Investors, and Authum Investment.
According to the government-owned ARC’s resolution plans, funds will be infused into Srei Infrastructure Finance (SIFL) to nurture the NBFC’s business. SIFL will focus on equipment finance and retail finance, among other sectors. Srei Equipment Finance (SEFL) will be instrumental in recovering bad assets and repaying lenders before being wound up.
NARCL has already disbursed a portion of upfront cash to the lenders of the two Srei firms.
It’s worth noting that Adisri Commercial, the promoter of SIFL and SEFL, has moved the National Company Law Appellate Tribunal (NCLAT) after NCLT Kolkata dismissed its application, challenging the initiation of insolvency proceedings against the two NBFCs. The appellate tribunal is currently reviewing the matter. PTI BSM MR
This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
