Ind-Barath Energy attracts ₹1,200-cr fresh bid

Suresh P Iyegar Mumbai | Updated on March 01, 2021

Dubai-based Star Group shows interest

Less than a month after JSW Energy recalled its bid for stressed Ind-Barath Energy (Utkal), Dubai-based Star Group has offered to pay ₹1,200 crore for the yet-to-be completed 700-MW thermal plant in Odisha.

The Star Group offer is much higher than ₹850-crore bid by JSW Energy.

Early close

In a letter written to the Resolution Professional of Ind-Barath Energy, the Dubai-based Star Group said in a bid to arrive at a fair valuation of the company and to close the Corporate Insolvency Resolution Process within the shortest possible time, the committee of creditors may take the features of JSW already available with them as the basis and negotiate further.

“It will be our endeavour to conclude the deal at the shortest possible time to your satisfaction. We are hopeful of making our resolution proposal both competitive, equitable and difficult to improve by another suitor,” it added.

Post-acquisition of the Ind-Barath, Star Group intends to invest another ₹500 crore in the asset within one year. The acquisition cost shall be paid within two years at terms negotiated from the equity and subordinated debt holders, it said.

“We can discuss with CoC and agree on the resolution plan within 4-6 weeks,” it said.

Requesting an invite from CoC, the Dubai-based company said that it is keen to take over Ind-Barath at the earliest and feels that its offer would be generous and far superior to the current market sentiment.

The company currently has no major businesses in India and would like to enter the Indian market by taking over large stressed assets and turning them around. It intends to play a crucial role in stressed assets in power generation and steel.

On February 2, JSW Energy recalled its bid for acquiring the thermal power plant of Ind-Barath Energy through the insolvency process initiated in 2019 due to the Covid pandemic outbreak.

The resolution plan of JSW Energy was approved by Committee of Creditors in October, 2019 and the plan was filed with the National Company Law Tribunal for approval.

The company was admitted to the Hyderabad Bench of the NCLT and both JSW Energy and Vedanta were in the race to acquire the insolvent firm.

Ind-Barath has coal linkage from Mahanadi Coalfields, a Coal India subsidiary, and PPAs signed with Odisha and Tamil Nadu governments.

Ind-Barath is owned by Australia-based asset manager Macquarie Group which has over 99 per cent stake in the company.

In 2015, Macquarie had lent ₹750 crore to Ind-Barath against convertible bonds. Two years later, Macquarie is believed to have converted the debt instrument into equity, thus acquiring a majority ownership. Later, Macquarie itself dragged Ind-Barath to NCLT in June, 2018 owing to a delay in commissioning of the project.

Published on March 01, 2021

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