Union Bank of India’s Swiss challenge auction on July 5 for five troubled accounts has attracted counter bids for only Jaypee Healthcare Ltd. Delhi-based Shine Star Build Cap emerged as the highest bidder to acquire the public sector lender’s non-performing debt in the company with a bid of Rs 72 crore, while Suraksha Asset Reconstruction came in second with a bid of Rs 65 crore.
Previously, JC Flower Asset Reconstruction had submitted a binding bid of Rs 61.80 crore for the stressed asset during an e-auction held on June 27. JC Flowers has now been given time till July 11 by Union Bank of India to match the highest bid, failing which Shine Star will be declared the successful bidder for Jaypee Healthcare. If JC Flower matches Shine Star’s bid, it will be declared the successful bidder.
Last month, the Allahabad bench of the National Company Law Tribunal admitted Jaypee Healthcare into the corporate insolvency resolution process on a petition filed by Yes Bank, whose debt has now been assigned to JC Flower. Other lenders to the company include Union Bank, Exim Bank, Punjab National Bank, Bank of Baroda, and ARCIL.
Union Bank of India’s debt in Jaypee Healthcare stood at Rs 68.56 crore as of March 2024, and it had set a reserve price of Rs 61.70 crore. The bank’s recovery from Jaypee Healthcare is expected to be more than 100 per cent once the debt is assigned. Jaypee Healthcare is a 100 per cent subsidiary of Jaypee Infratech.
Meanwhile, the remaining four accounts did not attract any counter bids during the Swiss challenge auction process conducted by Union Bank of India, leading to the original bidders being declared successful. Accordingly, Prudent ARC’s Rs 55 crore bid is the successful bid for Shree Saraiwwalaa AGRR Refineries; Maximum ARC’s Rs 27 crore bid is the successful bid for RCM Infrastructure; and CFM Asset Reconstruction’s Rs 16.29 crore bid for Green World International and Ram Chand Baboo Mal and Company is the successful bid.
Last month, Union Bank of India invited bids from banks, asset reconstruction companies, non-banking finance companies, alternate investment funds, and financial institutions for 25 non-performing accounts with a total outstanding of around Rs 1,268 crore as of March 31, 2024. Leo Meridian Infra Projects, with a total outstanding of Rs 263.53 crore, and Saraiwwalaa AGRR Refineries, with a total outstanding of Rs 335.91 crore, had the highest debt among the 25 accounts put up for sale by the bank.
Union Bank of India had set a reserve price for each of the accounts put up for sale and invited bids, on a full cash basis, from interested entities through an e-auction on June 27. It received bids for only 5 of the 25 accounts it had put up for sale. The rest of the accounts did not attract any bids because of the high reserve price set by the bank.
First Published: Jul 07 2024 | 5:43 PM IST