KSK Mahanadi sale process may pick up pace

KSK Mahanadi sale process may pick up pace

MUMBAI: Lenders to KSK Mahanadi Power will seek the bankruptcy tribunal’s intervention to expedite the company’s sale process, which has been hanging fire for more than five years, multiple people aware of the matter told ET.

On February 6, a requisite majority of KSK Mahanadi lenders passed a resolution to appeal to the National Company Law Tribunal (NCLT) to vacate a stay on the resolution process of the thermal power company and allow a standalone resolution of the company, the sources said.

Lenders have verified claims of Rs 29,330 crore in the company that operates three 600 mw units in Chhattisgarh.

NCLT had stayed the sale process in June 2022 following a plea from a lender to consolidate the resolution of KSK Mahanadi Power and two of its ancillary companies – KSK Water Infrastructure, which supplies water to the plant, and Raigarh Champa Rail, which carries the raw material.

Both the ancillary companies were separately admitted for corporate insolvency.

Lenders wanted a consolidated resolution to maximise recovery, but NCLT rejected the consolidation proposal. Subsequently, lenders appealed against the tribunal’s order at the National Company Law Appellate Tribunal (NCLAT).

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Meanwhile, PWC-supported resolution professional (RP) Sumit Binani invited offers for the thermal power company without waiting for NCLAT to pass an order.

In this context, the tribunal passed an order in June 2022 directing the RP to defer the resolution process and “not to undertake any process” until further orders subject to the outcome of the appeal pending before the NCLAT.

The appellate tribunal, too, has stayed the resolution process until it passes a final order on the matter.

Lenders will appeal with both NCLT and NCLAT to vacate the stay and allow a standalone resolution, the people cited above said.

In the past, Adani Power, Vedanta, Naveen Jindal-promoted Jindal Power, and Megha Engineering submitted expressions of interest for the thermal power company.

Over the past two years, a dozen lenders of KSK Mahanadi with about Rs 16,165 crore of verified claims have separately sold their debts to various ARCs due to delays in resolution. As many as six ARCs jointly control 54.4% of verified claims after acquiring loans from multiple banks.

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