The Kolkata bench of the bankruptcy court halted the corporate insolvency resolution process (CIRP) of thermal power company Hiranmaye Energy on the promoter’s plea that lenders should consider its ₹1,101.5 crore settlement offer, which is about one-fifth of the lenders’ debt, showed a tribunal order.
Meanwhile, over a dozen power-generating companies had submitted expressions of interest for the company, said people with knowledge.
Promoter, Power Trust, has proposed depositing ₹75 crore within five working days from the date their settlement offer is approved by the National Company Law Tribunal (NCLT). The balance of ₹1,026.5 crore will be paid in 90 working days, according to an order dated May 24 by the NCLT.
Under the settlement terms, lenders must agree to relinquish all charges on any assets as soon as the promoter makes full payment.
The CIRP is kept in abeyance until further orders while the tribunal directed lenders to decide on the settlement offer in two weeks. It also ordered the resolution professional (RP) to report the outcome to the meeting.
The RP, Bhuvan Madan backed by EY India, had pleaded against a stay of CIRP on grounds that even the Supreme Court has not granted a stay on the process following an appeal by the promoter.
The company has three 150 MW units located in Haldia, Kolkata, but only two are operational, and one is under construction. In 2017, it signed a 25-year power purchase agreement with the West Bengal government and has a coal procurement agreement with Coal India. BHEL designed and built the plant.
The RP has admitted verified claims of ₹5,291 crore. REC, Power Finance Corporation and RBL Bank are among the lenders to the thermal power company. A claim of ₹566 crore from the promoter Power Trust was not admitted, show disclosures made by the RP.
In 2013, REC and PFC jointly provided a ₹1,859 crore loan to Hiranmaye Energy to build a power plant, but the company failed to pay the outstanding amounts under the original terms on March 31, 2018, according to an admission order passed by the NCLT.
According to a July 28, 2023, rating report by Care Ratings, India Power Corporation invested ₹490.5 crore in Hiranmaye Energy in the form of fully compulsorily convertible debentures (FCCD) at a face value of ₹10 each. These FCCDs were transferred to Power Trust at book value in March 2017. Thereafter, the company ceased to be a subsidiary of IPCL on March 31, 2017, and became an associate, the report said.
In 2017-18, IPCL transferred the remaining investment in compulsorily convertible preference shares amounting to ₹306.8 crore to Power Trust.
According to the Care Ratings report, in 2010, the Kanoria family of Kolkata acquired DPSC through its investment company, India Power Corporation (erstwhile IPCL), from Andrew Yule & Co Ltd. In 2013, erstwhile IPCL merged with DPSC, and consequently, DPSC’s name was changed to IPCL.
