The race for Vidarbha Industries Power (VIPL), a subsidiary of Reliance Power, is heating up with three more companies, including Aditya Birla Asset Reconstruction Company and Reliance Asset Reconstruction Company (RARC), joining the fray. Rare Asset Reconstruction (Rare ARC) and Asset Reconstruction Company (India), or Arcil, have also submitted expressions of interest (EoIs) under the Swiss Challenge method.
While bids amounts submitted by the new entrants could not be immediately ascertained, sources close to the development said that Aditya Birla ARC is believed to be top bidder. Aditya Birla ARC is a joint venture between Aditya Birla Capital and Varde Partners. Earlier in June, the lenders to VIPL had restarted the company’s resolution process with its newly-appointed advisor, SBI Caps, inviting fresh bids. The bids were invited for the sale or one-time settlement of VIPL debt.
Three companies — Reliance Power, CFM Asset Reconstruction and National Asset Reconstruction Company (NARCL) — had earlier submitted suo moto bids for VIPL. SBI Caps will initiate the Swiss Challenge method and has fixed September 30 as the deadline to complete the process. CFM Asset Reconstruction had submitted a cash offer of Rs 1,220 crore and that of NARCL was `1,120 crore, while Reliance Power, another Anil Ambani group firm, had offered Rs 1,260 crore jointly with Varde Partners. Reliance Power’s offer was an upfront payment in all-cash.
According to Reliance Power’s annual report, VIPL had outstanding loans of `2,216 crore as of March 31, 2022. The lenders include State Bank of India, Canara Bank, Bank of Maharashtra, Punjab National Bank and Axis Bank, among others.In July last year, the Supreme Court had rejected a plea by Axis Bank, following default of loans, to admit VIPL for corporate insolvency resolution process (CIRP). The company had moved the apex court after the National Company Law Tribunal had approved admitting it for CIRP, and later on March 2, 2021, the National Company Law Appellate Tribunal refused to stay the process.
