Reliance Power offers Rs 1,200 cr cash settlement to VIPL Lenders

25 May 2023 CW Team

Reliance Power, a subsidiary of Reliance Infrastructure, has put forward a lucrative proposal to settle the debt of its subsidiary, Vidarbha Industries Power Ltd (VIPL). The company has offered a one-time settlement (OTS) amounting to Rs 1,200 crore to the lenders of VIPL, which include prominent financial institutions like Axis Bank, SBI, Bank of Baroda, PNB, Canara Bank, and Bank of Maharashtra.

As of March 31, 2022, VIPL carries an outstanding loan of approximately Rs 2,200 crore. Reliance Power's OTS offer stands out due to its commitment to pay the entire amount in upfront cash. To solidify this proposal, Reliance Power has secured the support of Varde Partners, an investor based in Singapore, which has vested interests in another company within the Reliance group, Reliance Infrastructure Ltd.

VIPL operates a coal-based power project in Nagpur with a substantial capacity of 600 MW. Previously, CFM Asset Reconstruction Pvt Ltd, headquartered in Ahmedabad, made an all-cash offer of Rs 1,120 crore to VIPL's lenders. However, CFM ARC is now under scrutiny by the Reserve Bank of India (RBI) and the Income Tax Department for alleged malpractices and business misconduct.

Following CFM ARC's offer, National Asset Reconstruction Company Ltd (NARCL) stepped in and proposed an amount of Rs 1,150 crore to VIPL's lenders. However, NARCL's offer includes only 15 percent payable in upfront cash, while the remaining sum will be disbursed through interest-free installments over the course of five years. The net present value of NARCL's offer is estimated to be merely Rs 850 crore.

In contrast, Reliance Power's OTS offer of Rs 1,200 crore in full cash payment presents a significantly higher and more attractive alternative for the lenders of VIPL. This offer ensures a prompt resolution to the debt issue and provides the lenders with a favourable outcome.

Infrastructure Transport

15 Sep 2025

Cabinet Approves Key Highway and Rail Projects in Bihar Region

The Union Cabinet on Wednesday approved the four-laning of the 84.2-km Mokama-Munger section of the Buxar-Bhagalpur high-speed corridor, a key industrial region in poll-bound Bihar. The Cabinet also sanctioned the doubling of the 177-km Bhagalpur-Dumka-Rampurhat railway line, which passes through Bihar, Jharkhand, and West Bengal, at a cost of Rs 31.7 billion.The Rs 44.5 billion highway project will be constructed under the hybrid annuity model, a variant of public-private partnership. The Mokama-Munger stretch was the only remaining two-lane section of the 363-km Buxar-Bhagalpur corridor. Fou..

NGT Issues Notice on Bengaluru Twin Tunnel Project

The National Green Tribunal (NGT) on Wednesday issued notices in response to a petition filed by Bengaluru Praja Vedike and others, challenging the Bengaluru twin tunnel road project. Petitioners claim the project was “hastily announced” and bypassed mandatory environmental impact assessment procedures.Notices have been served to the Karnataka Government, Greater Bengaluru Authority, State Environment Impact Assessment Authority (SEIAA), Bengaluru Smart Infrastructure Ltd (B-SMILE), the Union Ministry of Environment, Forest and Climate Change, and project consultants.The 16.74-km twin-tube..

India’s Residential Sales to Dip Slightly in FY26

Residential sales in India’s seven major cities are projected to decline by up to 3 per cent year-on-year in FY26 to 620–640 million square feet (msf), amid a moderation in sales velocity, according to ratings agency Icra.In FY25, sales stood at 643 msf, down 8 per cent YoY, following a sharp contraction in new launches and moderated demand in the affordable and mid-income segments. This slowdown came after the sector posted a robust compound annual growth rate of 26 per cent in area sales between FY22 and FY24.Icra noted: “Having seen a strong upcycle, the sector entered an equilibrium ..