A consortium of Canara Bank, State Bank of India, Union Bank and IFCI had called for bids for the sale of the loan.
JC Fool Asset Reconstruction has emerged as the highest bidder company with a bid of Is 410 crore to get the loan of Hyderabad-based Satavahana Ispat.
A consortium of Canara Bank, State Bank of India (SBI), Union Bank and IFCI had called for bids for the sale of the loan. A note states that Satavahana Ispat has a debt of over ₹ 1,000 crore and the debt is classified as non-performing assets (NPAs) in the books of lenders.
Four bids were received by the union. Other bids were for ₹ 380 crore from Maximus ARC; CFM ARC for Crore 370 crore; And for Welspun for 360 crores. Satavahana steel is mainly engaged in the manufacture of ductile iron pipes and pig iron. It also has a metallurgical coke plant.
After the evaluation of all four bids, the consortium formally selected Jessie Flowers as the H1 bidder. As a next step, and according to the due process, it is proposed to run a Swiss challenge process to maximize value (optimize the offer and find a better price for the lenders).
Lenders are trying to maximize recovery for themselves by taking advantage of the recent surge in steel prices. The note states that currently steel prices are at an all-time high.
Citing the RBI database and IFCI annual report, the note states that among public sector banks, SBI has an NPA amount of over PA 1.49 lakh crore, Canara Bank has 41 37,041 crore and NBI has I. 49,085 crores. The gross NPA of IFCI is I 7,774 crore.
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