JC Flowers seeks bids to sell Rs 2,613 crore of loans through Swiss auction

JC Flowers Asset Reconstruction Company, acting as a trustee of JCF YES Trust, is seeking bids to sell Rs 2,613 crore of outstanding retail and SME loans through a Swiss auction, which has been prompted by an anchor bid of Rs 237.5 crore.

 

The anchor bid for the loan portfolio, which comprises 15,096 accounts, translates into a recovery of 9.08 per cent on the outstanding portfolio.

 

Entities interested in acquiring the loans have to submit an expression of interest (EoI) by November 6.

 

The bids, if any, have to be on a 100 per cent cash basis. The anchor bidder, which has not been disclosed, will have the right to match the counterbid, following which the successful bidder will be declared.

 

 

These non-performing loans were part of Yes Bank’s portfolio of Rs 48,000 crore, which it sold to JC Flowers ARC in 2022. The portfolio was purchased by JC Flowers ARC at a consideration of Rs 11,200 crore in a 15:85 cash: security receipts structure, wherein JC Flowers has paid only 15 per cent of the consideration in cash, and the rest was in security receipts.

 

Post-acquisition, the ARC is acting as the manager for the portfolio workout to optimise recoveries. The portfolio consists of nonperforming and underperforming large corporate loans with significant real estate and infrastructure assets.

 

Previously, the company also sought counterbids on a full cash basis to sell Rs 1,290.18 crore in bad loans from four companies – Carnival Films, Cinema Ventures, Carnival Films Entertainment, and Stargaze Entertainment – through a Swiss challenge auction on November 18, based on anchor bid of just Rs 78 crore, translating to a recovery of just 6.04 per cent.