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Union Bank of India’s Swiss Challenge auction on July 5 for five troubled accounts has attracted counter bids for only Jaypee Healthcare. 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 Flowers Asset Reconstruction had submitted a binding bid of Rs 61.8 crore for the stressed asset during an e-auction held on June 27.
Union Bank of India has given JC Flowers time until July 11 to match the highest bid, failing which Shine Star will be declared the successful bidder for Jaypee Healthcare. If JC Flowers matches Shine Star’s bid, it will be declared a 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 Flowers.
Other lenders to the company include Union Bank, Exim Bank, Punjab National Bank, Bank of Baroda, and Asset Reconstruction Company (India).
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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 61.7 crore. The bank expects to recover more than 100 per cent of its debt once it 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 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 GreenWorld International and Ram Chand Baboo Mal & Company is the successful bid.
Last month, Union Bank of India invited bids from banks, asset reconstruction companies, non-banking financial companies, alternative 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 Infrastructure Projects & Hotels with a total outstanding of Rs 263.53 crore and Shree 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 five of the 25 accounts it had put up for sale. The rest of the accounts did not attract any bids due to the high reserve prices set by the bank.
In a nutshell
In a nutshell
Union Bank invited bids for 25 troubled accounts
E-auction conducted on June 27; received bids for 5 accounts
Bank calls for Swiss challenge auction on July 5
Receives counter bids for Jaypee Healthcare
Remaining 4 accounts did not receive counter bids
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