Lenders to sell debt of smart-city infra provider SPML Infra
SMART CITIES

Lenders to sell debt of smart-city infra provider SPML Infra

Lenders led by State Bank of India (SBI) have initiated the sale of over ₹2,000 crore debt of smart-city infrastructure provider SPML Infrastructure. The reserve price for the debt has been set at ₹405 crore, based on an anchor bid submitted by the government-backed National Asset Reconstruction Company Limited (NARCL).

The anchor bid equates to a recovery of 20% for the lenders.

IDBI Capital Markets & Securities, acting on behalf of SBI, Canara Bank, ICICI Bank, PNB, BOB, and Union Bank of India, has called bids for the debt of SPML Infra.

The six banks are collectively selling approximately ₹2,000 crore worth of debt, which includes both fund-based and non-fund-based loans, as well as optionally convertible debentures. The debt being offered for sale also carries a security value of ₹1,203 crore.

Bidders are required to submit their proposals by May 17, with the e-auction scheduled for June 6. Among the consortium of lenders, SBI holds the largest share of the debt at 38%, followed by Canara Bank at 31% and Punjab National Bank at 12.94%.

The bidding process is under the Swiss Challenge Method, where the bidders can submit with 15% cash and 85% security receipts (SR). The minimum mark-up required for any challenger bid is set at ₹25 crore, which is 6.17% of the base bid. Incremental bids can then be made in increments of ₹20.25 crore (5%) of the base bid.

IDBI Capital has invited interested Asset Reconstruction Companies (ARCs) to participate in both cash and cash:SR structures while other eligible participants, excluding ARCs, can only bid in full cash. ARCs opting for the cash. SR basis must provide an unconditional and irrevocable Bank Guarantee from a first-class bank for the SR portion.

In 2017, the lenders implemented a debt restructuring plan in line with the Reserve Bank of India's guidelines, acknowledging the financial distress faced by SMPL Infra. Consequently, the company's accounts with the banks have been categorized as non-performing assets, prompting most lenders to cease interest charges on loans to the company since November 1, 2019, adhering to RBI's prudential norms.

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Lenders led by State Bank of India (SBI) have initiated the sale of over ₹2,000 crore debt of smart-city infrastructure provider SPML Infrastructure. The reserve price for the debt has been set at ₹405 crore, based on an anchor bid submitted by the government-backed National Asset Reconstruction Company Limited (NARCL). The anchor bid equates to a recovery of 20% for the lenders. IDBI Capital Markets & Securities, acting on behalf of SBI, Canara Bank, ICICI Bank, PNB, BOB, and Union Bank of India, has called bids for the debt of SPML Infra. The six banks are collectively selling approximately ₹2,000 crore worth of debt, which includes both fund-based and non-fund-based loans, as well as optionally convertible debentures. The debt being offered for sale also carries a security value of ₹1,203 crore. Bidders are required to submit their proposals by May 17, with the e-auction scheduled for June 6. Among the consortium of lenders, SBI holds the largest share of the debt at 38%, followed by Canara Bank at 31% and Punjab National Bank at 12.94%. The bidding process is under the Swiss Challenge Method, where the bidders can submit with 15% cash and 85% security receipts (SR). The minimum mark-up required for any challenger bid is set at ₹25 crore, which is 6.17% of the base bid. Incremental bids can then be made in increments of ₹20.25 crore (5%) of the base bid. IDBI Capital has invited interested Asset Reconstruction Companies (ARCs) to participate in both cash and cash:SR structures while other eligible participants, excluding ARCs, can only bid in full cash. ARCs opting for the cash. SR basis must provide an unconditional and irrevocable Bank Guarantee from a first-class bank for the SR portion. In 2017, the lenders implemented a debt restructuring plan in line with the Reserve Bank of India's guidelines, acknowledging the financial distress faced by SMPL Infra. Consequently, the company's accounts with the banks have been categorized as non-performing assets, prompting most lenders to cease interest charges on loans to the company since November 1, 2019, adhering to RBI's prudential norms. Also read Godrej Properties on land-buying spree for housing projects Housing sales in FY23 were up 48% to Rs 3.47 lakh cr

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