Central Bank of India on Saturday put on the block stressed assets worth Rs 3,322 crore, including its exposure to Essar Steel India with an outstanding balance of Rs 423.61 crore, Bhushan Power & Steel (Rs 1,550.07 crore) and Alok Industries (Rs 1,251.10 crore), to be sold on a full-cash basis to any interested bank, asset reconstruction company, non-banking financial company or foreign investor. Notably, all three stressed accounts are undergoing corporate insolvency resolution proceedings.
In fact, among stressed accounts currently being resolved under the Insolvency and Bankruptcy Code, Essar Steel has witnessed the most number of lenders wanting a quick exit. Only last month, State Bank of India finally shelved its plans to sell its Rs 1,543-crore exposure to Essar Steel amid poor response despite several extensions. Last week, the National Company Law Appellate Tribunal directed its Ahmedabad bench to take a decision on ArcelorMittal’s resolution plan for the debt-laden Essar Steel by March 8.
If it failed to do so, it would call for records and pass an order.
The appellate tribunal further listed the matter for March 13. It is fairly well-known that delays in resolution owing to excessive litigation, among other factors, have prompted bankers to go for quick cash-based recoveries, sometimes even at a haircut compared to the expected recovery in event of a successful resolution under the IBC.
Central Bank of India has also listed Bombay Rayon Fashions Limited for sale at a reserve price of Rs 33.78 crore. The state-run lender has set a reserve price of Rs 415 crore for Essar Steel India, Rs 709.50 crore for Bhushan Power & Steel and Rs 197.63 crore for Alok Industries. FE
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