Aditya Birla ARC, Arcil among companies eyeing SBI’s KSK Mahanadi loan

Aditya Birla Asset Reconstruction Company, Kotak Mahindra Bank-backed Phoenix ARC and Avenue Capital-backed Arcil are among a dozen applicants interested in acquiring a Rs 3,815 crore KSK Mahanadi Power loan from State Bank of India, said people aware of the matter.

This is the largest stressed loan sale by a bank seeking upfront payment from the buyer. SBI has set a Rs 1,544 crore reserve price on the outstanding loan.

So far, most big-ticket distressed loan sales were structured deals involving part payment in the form of security receipts that would be redeemed upon recovery from defaulting borrowers.

“The timing of SBI’s proposed loan sale of KSK Mahanadi indicates that lenders are no longer confident of timely resolution under the Insolvency and Bankruptcy Code-driven process,” said a lender.

KSK Mahanadi Power has been undergoing insolvency proceedings for over two and a half years. The resolution professional, Sumit Binani, backed by PricewaterhouseCoopers, has extended the deadline to submit a firm bid to July 8 from April 29.