Phoenix ARC gets EOIs from ARCs for Rs 3,550 crore retail NPA sale

Phoenix ARC has received expressions of interest (EOIs) from 8-9 asset reconstruction companies (ARCs) to sell its retail non-performing assets (NPAs) worth Rs 3,550 crore. This consists of both secured and unsecured portfolios, offered as a single lot, which were put up for sale, according to sources.

The ARCs expressing interest include Asset Reconstruction Company (India) Ltd (ARCIL), backed by Avenue India Resurgence and State Bank of India; Omkara ARC; JM Financial ARC, supported by JM Financial; Encore ARC, backed by Encore Capital Group and ADV Partners; and International Asset Reconstruction Company (IARC), among others, according to sources.

Emails sent to Omkara ARC, JM Financial ARC, Encore ARC, and IARC did not elicit a response until the time of going to press. “At this time, we are not in a position to provide any comments on this matter,” said ARCIL in an email response.

 

Based on requests received from ARCs, Phoenix ARC has decided to extend the due diligence period from September 16 to September 24. Following this, binding bids will be invited on a full-cash basis on September 27, and the anchor bidder will be declared on October 7.

The portfolio put up for sale by Phoenix ARC includes 420 secured retail accounts amounting to Rs 186.9 crore and 560,805 unsecured retail accounts totaling Rs 3,363 crore.

The private sector ARC has also planned a Swiss challenge auction for the assets on offer, using the anchor bid as the base bid. EOIs for the Swiss challenge auction will be invited by October 21, with due diligence permitted until November 4.

Binding bids will be solicited on November 8, and the highest bidder will be announced on November 21. The anchor bidder will have the opportunity to match the highest bid, after which the successful bidder will be finalized on November 25.

Phoenix ARC had acquired this portfolio of retail loans from multiple banks and has already recovered close to Rs 1,000 crore from these NPA accounts. It has appointed BOB Capital Markets to assist and advise on the sale of NPAs.