Srei Infrastructure Finance
UPDATE 11: Srei Infrastructure Finance, Srei Equipment Finance Creditors to Meet Dec. 5 to Discuss 3 Resolution Plans, From Varde-Arena Consortium, NARCL, Authum
Mon 12/05/2022 19:16 PM
UPDATE 11: 7:36 a.m. ET 12/5/2022: Editors' Note: The following story was originally published in the evening of Dec. 5, and has been republished during regular business hours to reach a wider audience.
Srei Infrastructure Finance and Srei Equipment Finance creditors are holding a joint lenders meeting today, Dec. 5, to discuss resolution plans received from a consortium of Varde Partners with Arena Investors LP; National Asset Reconstruction Company Ltd. (NARCL); and Authum Investment & Infrastructure Ltd., two sources with direct knowledge said.
The Varde-Arena consortium has submitted a resolution plan aggregating to INR 140 billion ($1.71 billion), while the NARCL plan totals INR 136 billion, the source said. The resolution plan submitted by Authum Investment & Infrastructure totals INR 35 billion, the sources said.
SREI Infrastructure Finance Ltd. had on Dec. 3 announced that the twenty-third meeting of the consolidated committee of creditors (CoC) of Srei Infrastructure Finance and Srei Equipment Finance had been conducted virtually on the same day, and three resolution plans had been received under the ongoing in-court insolvency process for the combined businesses, pursuant to the reissued request for resolution plans dated Sept. 24.
Varde-Arena Plan
The INR 140 billion resolution plan of the Varde-Arena consortium includes upfront cash of INR 28.74 billion and an equity infusion of INR 900 million, out of which Arena’s equity infusion would be INR 720 million and Varde’s contribution would be INR 180 million, the sources added.
The plan also includes INR 14 billion or a 25% equity stake to the financial creditors and securities worth INR 96.4 billion, the sources said.
The securities include senior non-convertible debentures of INR 34.2 billion with 0.01% interest and INR 62.2 billion optionally convertible debentures paying 0.01% interest to the creditors, the sources said.
The Varde consortium in September had submitted an INR 145 billion bid for both Srei Infrastructure and Srei Equipment Finance, including an upfront cash payment of INR 20 billion, as reported.
Reorg reported on Sept. 16 that two resolution plans submitted by a Varde consortium, and two high net-worth individuals were dismissed as non-compliant by the CoC, as earnest money deposits submitted did not comply with the required format.
NARCL Plan
NARCL’s INR 136 billion resolution plan includes upfront cash of INR 15 billion and INR 6 billion cash will be provided for a portfolio of securitized loans, the sources said.
The plan also involves providing INR 2 billion, or a 20% equity stake, to lenders to the financial creditors and securities worth INR 41 billion, the sources said.
The securities include NCDs of INR 33 billion which include security receipts worth INR 18 billion, the sources said. The plan also includes INR 80 billion worth of optionally convertible debentures, the sources added.
The security receipts will carry a central government guarantee, the sources said.
Authum Plan
Authum Investment & Infrastructure’s INR 35 billion resolution plan includes upfront cash of INR 26.87 billion to the financial creditors and INR 120 million cash to the operational creditors, and a INR 1 billion equity infusion, the sources said. The plan also includes three tranches of zero-coupon NCDs of INR 2.34 billion each, the sources added.
Details of the NCDs with maturities are below:
Varde declined to comment. Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma, Arena, NARCL and Authum did not respond to calls or emails requesting comment.
– Dipika Lalwani, Malvika Joshi
UPDATE 10: Srei’s Consolidated CoC Receives 3 Resolution Plans, Conducts 23rd Meeting
UPDATE 10: 7:19 p.m. ET 12/4/2022: SREI Infrastructure Finance Ltd., announced to the BSE Ltd. on Dec. 3 that the 23rd meeting of the consolidated committee of creditors (CoC) of Srei Infrastructure Finance Limited and Srei Equipment Finance Limited was conducted virtually on the same day and three resolution plans were received under the ongoing in-court insolvency process for the combined businesses, pursuant to the reissued request for resolution plan dated Sept. 24.
UPDATE 9: Srei Consolidated CoC Likely to Meet Nov. 25 to Approve Extension of Final Submission Date for Resolution Plans to Dec. 2
UPDATE 9: 3:29 a.m. ET 11/25/2022: The consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance are likely to meet today, Nov. 25, to vote on the extension of the final submission date for resolution plans by prospective resolution applicants, to Dec. 2 from Nov. 25, according to two sources with direct knowledge.
The bank lenders at the meeting held on Thursday Nov. 24, gave in-principle approval to extend the deadline to Dec. 2, the sources added.
The deadline extension was sought from a few prospective resolution applicants, including National Asset Reconstruction Company Ltd. (NARCL), the sources said.
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma declined to comment. NARCL spokesperson did not respond to calls or messages requesting a comment on the development.
– Dipika Lalwani, Malvika Joshi
UPDATE 8: Srei Consolidated CoC Approves Extension of Final Submission Date for Resolution Plans to Nov. 25
UPDATE 8: 6:56 p.m. ET 11/13/2022: Srei Infrastructure Finance Ltd. announced to the BSE Ltd. on Nov. 11 that the consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance, at its twenty-first meeting on Nov. 11, approved extension of the final submission date for resolution plans by prospective resolution applicants, or PRAs, to Nov. 25 from Nov. 15.
UPDATE 7: NCLT Extends Srei Infrastructure Finance CIRP Completion Deadline to Jan. 5, 2023
UPDATE 7: 6:59 p.m. ET 11/10/2022: Srei Infrastructure Finance announced to the BSE Ltd. on Nov. 10, that the National Company Law Tribunal (NCLT), Kolkata bench, has extended the deadline to complete the company’s corporate insolvency resolution process (CIRP) until Jan. 5, 2023. The NCLT order is attached to the announcement.
UPDATE 6: Srei CoC to Meet Today, Oct. 17 to Discuss Capri Global’s EoI, NARCL Expected to Submit EoI
UPDATE 6: 7:16 a.m. ET 10/17/2022: The consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance are likely to meet today, Oct. 17 to discuss Capri Global Capital Ltd.’s submission of an expression of interest (EoI) for Srei Group, according to two sources with knowledge of the matter.
Capri Global submitted an EoI on Saturday, Oct. 15 and was not a part of the original prospective resolution applicants (PRAs), the sources added. The CoC is also expecting an EoI from National Asset Reconstruction Company Ltd. (NARCL), the sources said.
The renewed interest in Srei Group follows another unexpected EoI by ArcelorMittal which was submitted on Sept. 28, as reported.
In the last consolidated CoC meeting, 89% of the CoC members voted in favor of extending the deadline for submission of resolution plans to Nov. 15, although the administrator, Rajneesh Sharma, will need to approach the National Company Law Tribunal (NCLT), Kolkata bench, to seek an extension, as the ongoing corporate insolvency resolution process (CIRP) needs to be completed by Nov. 3, the sources said.
NARCL and Capri Global declined to comment. Rajneesh Sharma did not respond to requests for comment.
– Poonam Bansal, Dipika Lalwani
UPDATE 5: Srei CoC Votes to Extend Resolution Plan Date to Nov. 15
UPDATE 5: 7:43 p.m. ET 10/16/2022: Srei Infrastructure Finance Ltd. announced to the BSE Ltd. on Oct. 15 that the committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance, at its 18th CoC meeting approved the extension of the final submission date for resolution plans by prospective resolution applicants, or PRAs, to Nov. 15.
UPDATE 4: Srei CoC to Vote on Extension to Nov. 15 from Oct. 15 for Submission of Resolution Plan, Seeks Additional 60 Days to Conclude CIRP
UPDATE 4: 9:05 a.m. ET 10/13/2022: The committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance will meet on Thursday, Oct. 13, to begin voting on extending the deadline for submission of resolution plans by prospective resolution applicants, or PRAs, to Nov. 15 from Oct. 15, according to two sources with direct knowledge. The voting will end late evening on Friday, Oct. 14, the sources said.
The CoC will also vote on seeking a 60-day extension to conclude the corporate insolvency resolution process, or CIRP, from the National Company Law Tribunal, Kolkata bench, the sources added.
On Aug. 31, the NCLT, Kolkata bench granted an additional 60 days to Nov. 3 for the company to conclude the CIRP, as reported.
Some PRAs have sought extensions ranging from 45 to 60 days of the deadline for submission of resolution plans, the sources said.
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma declined to comment.
– Poonam Bansal, Dipika Lalwani
UPDATE 3: Srei Infrastructure Finance Reiterates Oct.15 Deadline to Submit Resolution Plan, 'Shall Not be Extended'
UPDATE 3: 8:08 p.m. ET 10/4/2022: Srei Infrastructure Finance in a filing to the BSE Ltd. on Oct. 4 reiterated that its resolution plan submission deadline is Oct. 15 and this "shall not be extended," except at the sole discretion of the consolidated committee of creditors.
UPDATE 2: Srei Infrastructure Finance Releases Revised Final PRA List, Includes ArcelorMittal Affiliate as Prospective Resolution Applicant
UPDATE 2: 8:02 p.m. ET 10/2/2022: Srei Infrastructure Finance announced to the BSE Ltd. on Oct. 2, that the final list of prospective resolution applicants (PRAs) of the company and its wholly-owned subsidiary Srei Equipment has been released. The list includes AM Mining India Pvt. Ltd., an affiliate of ArcelorMittal as PRA.
The revised final list of PRAs for Srei Infrastructure Finance and Srei Equipment Finance is below:
AM Mining India submitted an expression of interest (EoI) on Sept. 27 after the expiry of the last date of submission of EoIs, according to the final list of PRAs.
The EoI submitted by AM Mining India was placed before the committee of creditors (CoC) during its meeting held on Oct. 1, and the CoC at its seventeenth meeting approved a resolution to include the name of AM Mining India in the final list of PRAs, considering all aspects including the value maximization for all stakeholders including but not limited to banks, financial institutions, and retail debenture holders, according to the details provided in the final list of PRA statement.
Reorg, on Sept. 29, reported that Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma was likely to schedule a meeting of the consolidated CoC, last week or early this week to discuss ArcelorMittal SA’s submission of an EoI for Srei Group.
UPDATE 1: ArcelorMittal Submits EoI for Srei Group, Administrator Likely to Schedule Consolidated CoC Meeting This Week or Early Next Week to Discuss
UPDATE 1: 6:21 a.m. ET 9/29/2022: Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma is likely to
schedule a meeting of the consolidated committee of creditors, or CoC, this week or early next week to discuss ArcelorMittal SA’s submission of an expression of interest (EoI) for Srei Group, according to three sources with knowledge of the matter.
ArcelorMittal SA submitted the EoI on Sept. 28, according to the sources.
The administrator has invited fresh resolution plans by Oct. 15 from the 13 original prospective resolution applicants, as reported. ArcelorMittal is not part of the original PRA list, the source said.
The consolidated CoC will discuss whether the EoI should be accepted or not at this stage (more below), the sources said. The acceptance of the EoI would delay the resolution process further as the deadline to submit the resolution plan might have to be extended again, the sources explained.
However, the CoC could consider extending the deadline if ArcelorMittal provides a preliminary resolution plan which would lead to higher recovery value for the lenders, the sources added. The consolidated CoC will also seek legal advice in case existing PRAs raise objections if the CoC decides to accommodate ArcelorMittal as a PRA, the sources added.
On Aug. 31, the National Company Law Tribunal, Kolkata bench passed an order granting an additional 60 days to Nov. 3 for the company to complete its ongoing corporate insolvency resolution process, or CIRP, as reported. The administrator in its application seeking extension had stated two resolution plans had been received, as further reported.
Reorg reported on Sept. 16, the two resolution plans - submitted by Varde Partners with Arena Investors LP, and two high net-worth individuals after extending the deadline to submit resolution plans seven times- were dismissed as non-compliant by the CoC, as the earnest money deposits submitted did not comply with the required format.
The Varde consortium wanted to attach a clause to the effect that the deposit be returned within three months if the bid was not selected, while the HNI bidders had sought to add a clause stating that the earnest money deposits should be returned if the plan was not approved within two months, as previously reported. The CoC in its deliberations found it could not agree with attaching clauses to the earnest money deposits that create a restricted time frame, as also reported.
The CoC at a subsequent Sept. 17 meeting discussed amending the request for resolution plan (RFRP) documentation to ensure that resolution plans submitted in the future complies to earnest money deposit (EMD) clauses.
Rajneesh Sharma declined to comment. ArcelorMittal did not respond to a request for comment.
– Poonam Bansal, Dipika Lalwani
Original Story 8:51 p.m. UTC on Sep. 21, 2022
Srei Administrator to Invite Fresh Resolution Plans by Oct. 15; RFPR Amendment Includes Reductions in Earnest Money Deposits, Performance Bank Guarantee
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma is to issue a revised request for resolution plan (RFRP) documentation on Sept. 24 and invite fresh resolution plans from 13 original prospective resolution applicants by Oct. 15, according to two sources with direct knowledge.
The deadline to submit any query with respect to the revised RFRP is Oct. 10, the source said.
Changes to the revised RFRP include a reduction in the size of required earnest money deposits, or EMDs, to INR 500 million ($6.3 million) from INR 1.5 billion, and for unsuccessful bidders, the time they will be held after a letter of intent is issued to a successful bidder has been reduced to seven from 14 days. The unconditional and irrevocable performance bank guarantee, which the successful resolution applicant has to provide within 14 days of the issue of the letter of intent, has been reduced to INR 1.5 billion. Previously it was set at 5% of the aggregate resolution amount, subject to a minimum INR 5.6 billion.
The consolidated committee of creditors, or consolidated CoC, of Srei Infrastructure Finance Ltd. and Srei Equipment Finance Ltd. at its Sept. 17 meeting discussed amending the request for resolution plan (RFRP) documentation and inviting fresh bids from prospective resolution applicants, as reported.
Resolution plans for Srei Group submitted by Varde Partners with Arena Investors LP, and two high net-worth individuals, were dismissed as non-compliant by the CoC as earnest money deposits (EMD) submitted did not comply with the required format, as reported.
RFRP Amendments
The revised RFRP includes a reduction in the required EMD to INR 500 million ($6.3 million) from INR 1.5 billion, the sources said.
The administrator can consider the resolution plan as “non-responsive” and correspondingly the consolidated CoC would have the right to reject such a resolution plan, if the plan is submitted without an EMD or is not in the prescribed format under the RFRP, the sources added.
For the successful resolution applicant, the EMD is valid until the performance security is provided in the prescribed format, the sources said. The EMD will be returned within seven days of issuance of the performance security.
The EMD provided by the resolution applicant whose resolution plan has not been selected is valid until the date of approval of the successful resolution plan by the consolidated CoC. The timeframe to return the EMD, without interest, of an unsuccessful resolution applicant has been lowered to seven days from fourteen days after the issue of the letter of intent to the successful bidder, the sources said.
Performance Security
The revised RFRP has also lowered the size of an unconditional and irrevocable performance bank guarantee, which the successful resolution applicant has to furnish within 14 days of the issue of the letter of intent to INR 1.5 billion, the sources added.
Earlier, the successful resolution applicant was required to provide a performance bank guarantee equivalent to 5% of the aggregate resolution amount, subject to a minimum INR 5.6 billion, the sources explained.
The revised RFRP includes a clause that the administrator can invoke the performance security if the Reserve Bank of India rejects the resolution plan and does not provide a no-objection certificate (NOC) for any of the following reasons:
– Dipika Lalwani
Srei Infrastructure Finance and Srei Equipment Finance creditors are holding a joint lenders meeting today, Dec. 5, to discuss resolution plans received from a consortium of Varde Partners with Arena Investors LP; National Asset Reconstruction Company Ltd. (NARCL); and Authum Investment & Infrastructure Ltd., two sources with direct knowledge said.
The Varde-Arena consortium has submitted a resolution plan aggregating to INR 140 billion ($1.71 billion), while the NARCL plan totals INR 136 billion, the source said. The resolution plan submitted by Authum Investment & Infrastructure totals INR 35 billion, the sources said.
SREI Infrastructure Finance Ltd. had on Dec. 3 announced that the twenty-third meeting of the consolidated committee of creditors (CoC) of Srei Infrastructure Finance and Srei Equipment Finance had been conducted virtually on the same day, and three resolution plans had been received under the ongoing in-court insolvency process for the combined businesses, pursuant to the reissued request for resolution plans dated Sept. 24.
Varde-Arena Plan
The INR 140 billion resolution plan of the Varde-Arena consortium includes upfront cash of INR 28.74 billion and an equity infusion of INR 900 million, out of which Arena’s equity infusion would be INR 720 million and Varde’s contribution would be INR 180 million, the sources added.
The plan also includes INR 14 billion or a 25% equity stake to the financial creditors and securities worth INR 96.4 billion, the sources said.
The securities include senior non-convertible debentures of INR 34.2 billion with 0.01% interest and INR 62.2 billion optionally convertible debentures paying 0.01% interest to the creditors, the sources said.
The Varde consortium in September had submitted an INR 145 billion bid for both Srei Infrastructure and Srei Equipment Finance, including an upfront cash payment of INR 20 billion, as reported.
Reorg reported on Sept. 16 that two resolution plans submitted by a Varde consortium, and two high net-worth individuals were dismissed as non-compliant by the CoC, as earnest money deposits submitted did not comply with the required format.
NARCL Plan
NARCL’s INR 136 billion resolution plan includes upfront cash of INR 15 billion and INR 6 billion cash will be provided for a portfolio of securitized loans, the sources said.
The plan also involves providing INR 2 billion, or a 20% equity stake, to lenders to the financial creditors and securities worth INR 41 billion, the sources said.
The securities include NCDs of INR 33 billion which include security receipts worth INR 18 billion, the sources said. The plan also includes INR 80 billion worth of optionally convertible debentures, the sources added.
The security receipts will carry a central government guarantee, the sources said.
Authum Plan
Authum Investment & Infrastructure’s INR 35 billion resolution plan includes upfront cash of INR 26.87 billion to the financial creditors and INR 120 million cash to the operational creditors, and a INR 1 billion equity infusion, the sources said. The plan also includes three tranches of zero-coupon NCDs of INR 2.34 billion each, the sources added.
Details of the NCDs with maturities are below:
- INR 2.34 billion NCDs maturing in one year will have an internal rate of return of 8%
- INR 2.34 billion NCDs maturing in two and three years will have an internal rate of return of 10% each.
Varde declined to comment. Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma, Arena, NARCL and Authum did not respond to calls or emails requesting comment.
– Dipika Lalwani, Malvika Joshi
UPDATE 10: Srei’s Consolidated CoC Receives 3 Resolution Plans, Conducts 23rd Meeting
UPDATE 10: 7:19 p.m. ET 12/4/2022: SREI Infrastructure Finance Ltd., announced to the BSE Ltd. on Dec. 3 that the 23rd meeting of the consolidated committee of creditors (CoC) of Srei Infrastructure Finance Limited and Srei Equipment Finance Limited was conducted virtually on the same day and three resolution plans were received under the ongoing in-court insolvency process for the combined businesses, pursuant to the reissued request for resolution plan dated Sept. 24.
UPDATE 9: Srei Consolidated CoC Likely to Meet Nov. 25 to Approve Extension of Final Submission Date for Resolution Plans to Dec. 2
UPDATE 9: 3:29 a.m. ET 11/25/2022: The consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance are likely to meet today, Nov. 25, to vote on the extension of the final submission date for resolution plans by prospective resolution applicants, to Dec. 2 from Nov. 25, according to two sources with direct knowledge.
The bank lenders at the meeting held on Thursday Nov. 24, gave in-principle approval to extend the deadline to Dec. 2, the sources added.
The deadline extension was sought from a few prospective resolution applicants, including National Asset Reconstruction Company Ltd. (NARCL), the sources said.
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma declined to comment. NARCL spokesperson did not respond to calls or messages requesting a comment on the development.
– Dipika Lalwani, Malvika Joshi
UPDATE 8: Srei Consolidated CoC Approves Extension of Final Submission Date for Resolution Plans to Nov. 25
UPDATE 8: 6:56 p.m. ET 11/13/2022: Srei Infrastructure Finance Ltd. announced to the BSE Ltd. on Nov. 11 that the consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance, at its twenty-first meeting on Nov. 11, approved extension of the final submission date for resolution plans by prospective resolution applicants, or PRAs, to Nov. 25 from Nov. 15.
UPDATE 7: NCLT Extends Srei Infrastructure Finance CIRP Completion Deadline to Jan. 5, 2023
UPDATE 7: 6:59 p.m. ET 11/10/2022: Srei Infrastructure Finance announced to the BSE Ltd. on Nov. 10, that the National Company Law Tribunal (NCLT), Kolkata bench, has extended the deadline to complete the company’s corporate insolvency resolution process (CIRP) until Jan. 5, 2023. The NCLT order is attached to the announcement.
UPDATE 6: Srei CoC to Meet Today, Oct. 17 to Discuss Capri Global’s EoI, NARCL Expected to Submit EoI
UPDATE 6: 7:16 a.m. ET 10/17/2022: The consolidated committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance are likely to meet today, Oct. 17 to discuss Capri Global Capital Ltd.’s submission of an expression of interest (EoI) for Srei Group, according to two sources with knowledge of the matter.
Capri Global submitted an EoI on Saturday, Oct. 15 and was not a part of the original prospective resolution applicants (PRAs), the sources added. The CoC is also expecting an EoI from National Asset Reconstruction Company Ltd. (NARCL), the sources said.
The renewed interest in Srei Group follows another unexpected EoI by ArcelorMittal which was submitted on Sept. 28, as reported.
In the last consolidated CoC meeting, 89% of the CoC members voted in favor of extending the deadline for submission of resolution plans to Nov. 15, although the administrator, Rajneesh Sharma, will need to approach the National Company Law Tribunal (NCLT), Kolkata bench, to seek an extension, as the ongoing corporate insolvency resolution process (CIRP) needs to be completed by Nov. 3, the sources said.
NARCL and Capri Global declined to comment. Rajneesh Sharma did not respond to requests for comment.
– Poonam Bansal, Dipika Lalwani
UPDATE 5: Srei CoC Votes to Extend Resolution Plan Date to Nov. 15
UPDATE 5: 7:43 p.m. ET 10/16/2022: Srei Infrastructure Finance Ltd. announced to the BSE Ltd. on Oct. 15 that the committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance, at its 18th CoC meeting approved the extension of the final submission date for resolution plans by prospective resolution applicants, or PRAs, to Nov. 15.
UPDATE 4: Srei CoC to Vote on Extension to Nov. 15 from Oct. 15 for Submission of Resolution Plan, Seeks Additional 60 Days to Conclude CIRP
UPDATE 4: 9:05 a.m. ET 10/13/2022: The committee of creditors, or CoC, of Srei Infrastructure Finance and Srei Equipment Finance will meet on Thursday, Oct. 13, to begin voting on extending the deadline for submission of resolution plans by prospective resolution applicants, or PRAs, to Nov. 15 from Oct. 15, according to two sources with direct knowledge. The voting will end late evening on Friday, Oct. 14, the sources said.
The CoC will also vote on seeking a 60-day extension to conclude the corporate insolvency resolution process, or CIRP, from the National Company Law Tribunal, Kolkata bench, the sources added.
On Aug. 31, the NCLT, Kolkata bench granted an additional 60 days to Nov. 3 for the company to conclude the CIRP, as reported.
Some PRAs have sought extensions ranging from 45 to 60 days of the deadline for submission of resolution plans, the sources said.
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma declined to comment.
– Poonam Bansal, Dipika Lalwani
UPDATE 3: Srei Infrastructure Finance Reiterates Oct.15 Deadline to Submit Resolution Plan, 'Shall Not be Extended'
UPDATE 3: 8:08 p.m. ET 10/4/2022: Srei Infrastructure Finance in a filing to the BSE Ltd. on Oct. 4 reiterated that its resolution plan submission deadline is Oct. 15 and this "shall not be extended," except at the sole discretion of the consolidated committee of creditors.
UPDATE 2: Srei Infrastructure Finance Releases Revised Final PRA List, Includes ArcelorMittal Affiliate as Prospective Resolution Applicant
UPDATE 2: 8:02 p.m. ET 10/2/2022: Srei Infrastructure Finance announced to the BSE Ltd. on Oct. 2, that the final list of prospective resolution applicants (PRAs) of the company and its wholly-owned subsidiary Srei Equipment has been released. The list includes AM Mining India Pvt. Ltd., an affiliate of ArcelorMittal as PRA.
The revised final list of PRAs for Srei Infrastructure Finance and Srei Equipment Finance is below:
AM Mining India submitted an expression of interest (EoI) on Sept. 27 after the expiry of the last date of submission of EoIs, according to the final list of PRAs.
The EoI submitted by AM Mining India was placed before the committee of creditors (CoC) during its meeting held on Oct. 1, and the CoC at its seventeenth meeting approved a resolution to include the name of AM Mining India in the final list of PRAs, considering all aspects including the value maximization for all stakeholders including but not limited to banks, financial institutions, and retail debenture holders, according to the details provided in the final list of PRA statement.
Reorg, on Sept. 29, reported that Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma was likely to schedule a meeting of the consolidated CoC, last week or early this week to discuss ArcelorMittal SA’s submission of an EoI for Srei Group.
UPDATE 1: ArcelorMittal Submits EoI for Srei Group, Administrator Likely to Schedule Consolidated CoC Meeting This Week or Early Next Week to Discuss
UPDATE 1: 6:21 a.m. ET 9/29/2022: Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma is likely to
schedule a meeting of the consolidated committee of creditors, or CoC, this week or early next week to discuss ArcelorMittal SA’s submission of an expression of interest (EoI) for Srei Group, according to three sources with knowledge of the matter.
ArcelorMittal SA submitted the EoI on Sept. 28, according to the sources.
The administrator has invited fresh resolution plans by Oct. 15 from the 13 original prospective resolution applicants, as reported. ArcelorMittal is not part of the original PRA list, the source said.
The consolidated CoC will discuss whether the EoI should be accepted or not at this stage (more below), the sources said. The acceptance of the EoI would delay the resolution process further as the deadline to submit the resolution plan might have to be extended again, the sources explained.
However, the CoC could consider extending the deadline if ArcelorMittal provides a preliminary resolution plan which would lead to higher recovery value for the lenders, the sources added. The consolidated CoC will also seek legal advice in case existing PRAs raise objections if the CoC decides to accommodate ArcelorMittal as a PRA, the sources added.
On Aug. 31, the National Company Law Tribunal, Kolkata bench passed an order granting an additional 60 days to Nov. 3 for the company to complete its ongoing corporate insolvency resolution process, or CIRP, as reported. The administrator in its application seeking extension had stated two resolution plans had been received, as further reported.
Reorg reported on Sept. 16, the two resolution plans - submitted by Varde Partners with Arena Investors LP, and two high net-worth individuals after extending the deadline to submit resolution plans seven times- were dismissed as non-compliant by the CoC, as the earnest money deposits submitted did not comply with the required format.
The Varde consortium wanted to attach a clause to the effect that the deposit be returned within three months if the bid was not selected, while the HNI bidders had sought to add a clause stating that the earnest money deposits should be returned if the plan was not approved within two months, as previously reported. The CoC in its deliberations found it could not agree with attaching clauses to the earnest money deposits that create a restricted time frame, as also reported.
The CoC at a subsequent Sept. 17 meeting discussed amending the request for resolution plan (RFRP) documentation to ensure that resolution plans submitted in the future complies to earnest money deposit (EMD) clauses.
Rajneesh Sharma declined to comment. ArcelorMittal did not respond to a request for comment.
– Poonam Bansal, Dipika Lalwani
Original Story 8:51 p.m. UTC on Sep. 21, 2022
Srei Administrator to Invite Fresh Resolution Plans by Oct. 15; RFPR Amendment Includes Reductions in Earnest Money Deposits, Performance Bank Guarantee
Srei Infrastructure Finance and Srei Equipment Finance administrator Rajneesh Sharma is to issue a revised request for resolution plan (RFRP) documentation on Sept. 24 and invite fresh resolution plans from 13 original prospective resolution applicants by Oct. 15, according to two sources with direct knowledge.
The deadline to submit any query with respect to the revised RFRP is Oct. 10, the source said.
Changes to the revised RFRP include a reduction in the size of required earnest money deposits, or EMDs, to INR 500 million ($6.3 million) from INR 1.5 billion, and for unsuccessful bidders, the time they will be held after a letter of intent is issued to a successful bidder has been reduced to seven from 14 days. The unconditional and irrevocable performance bank guarantee, which the successful resolution applicant has to provide within 14 days of the issue of the letter of intent, has been reduced to INR 1.5 billion. Previously it was set at 5% of the aggregate resolution amount, subject to a minimum INR 5.6 billion.
The consolidated committee of creditors, or consolidated CoC, of Srei Infrastructure Finance Ltd. and Srei Equipment Finance Ltd. at its Sept. 17 meeting discussed amending the request for resolution plan (RFRP) documentation and inviting fresh bids from prospective resolution applicants, as reported.
Resolution plans for Srei Group submitted by Varde Partners with Arena Investors LP, and two high net-worth individuals, were dismissed as non-compliant by the CoC as earnest money deposits (EMD) submitted did not comply with the required format, as reported.
RFRP Amendments
The revised RFRP includes a reduction in the required EMD to INR 500 million ($6.3 million) from INR 1.5 billion, the sources said.
The administrator can consider the resolution plan as “non-responsive” and correspondingly the consolidated CoC would have the right to reject such a resolution plan, if the plan is submitted without an EMD or is not in the prescribed format under the RFRP, the sources added.
For the successful resolution applicant, the EMD is valid until the performance security is provided in the prescribed format, the sources said. The EMD will be returned within seven days of issuance of the performance security.
The EMD provided by the resolution applicant whose resolution plan has not been selected is valid until the date of approval of the successful resolution plan by the consolidated CoC. The timeframe to return the EMD, without interest, of an unsuccessful resolution applicant has been lowered to seven days from fourteen days after the issue of the letter of intent to the successful bidder, the sources said.
Performance Security
The revised RFRP has also lowered the size of an unconditional and irrevocable performance bank guarantee, which the successful resolution applicant has to furnish within 14 days of the issue of the letter of intent to INR 1.5 billion, the sources added.
Earlier, the successful resolution applicant was required to provide a performance bank guarantee equivalent to 5% of the aggregate resolution amount, subject to a minimum INR 5.6 billion, the sources explained.
The revised RFRP includes a clause that the administrator can invoke the performance security if the Reserve Bank of India rejects the resolution plan and does not provide a no-objection certificate (NOC) for any of the following reasons:
- If the successful resolution applicant has made any misrepresentations in relation to the successful resolution plan;
- If the applicant has omitted any relevant fact or information or document in relation to the successful resolution plan;
- If the applicant has not extended all cooperation to the RBI.
– Dipika Lalwani
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