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SBI Caps is said to have shortlisted Aditya Birla ARC, Reliance ARC and Asset Reconstruction Company India Ltd (ARCIL) for participation in the Swiss Challenge process of Vidarbha Industries Power Ltd (VIPL).
“These three ARCs will now proceed with the due diligence before making a financial bid for VIPL. All three bidders will be given 3 weeks to complete the due diligence process. Post the due diligence, the bidders will be given one week for the queries and discussion, followed by one week for the Swiss Challenge process,” said a banking source.
Post the Swiss Challenge process, lenders will take 2 to 3 weeks to close the entire process, thereby completing the sale of VIPL debt by September-end, the source added.
VIPL is a subsidiary of Reliance Power Ltd, which owns 2 units of 300 MW each at Butibori, Nagpur.
Stranded asset
VIPL is a stranded asset, which has no Fuel Supply Agreement (FSA) and no Power Purchase Agreement (PPA).
Initially, VIPL had a PPA with the Mumbai Power Distribution business of Reliance Infrastructure, which was terminated by Adani Gorup after it took over the distribution business from Reliance.
The matter of termination of the PPA is pending in the Supreme Court.
The lead banker, Axis Bank, had issued an invitation for EOI for the sale of VIPL’s outstanding debt of ₹2,500 crore, on 10 July. The last date to submit EOI was July 17.
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