ksk Adani Group’s offer of Rs 12,500 crore to acquire Mahanadi Power has prompted other bidders to revise their offers and the final figure could be much higher. The sources gave this information on Friday. KSK Mahanadi Power is expected to recover its non-performing assets (NPA) in full after the Committee of Creditors (CoC) initiated the mechanism to challenge the bid.
Adani Group made the highest bid
However, this is almost rare in proceedings carried out under the Insolvency and Bankruptcy Code (IBC). Sources associated with the IBC deal have credited the Adani Group for generating interest in KSK Mahanadi. Adani Group has made a high initial bid of Rs 12,500 crore for the troubled company. This bid is Rs 4,800 crore, or 62 per cent more than the second-ranked bidder. The result is that six of the original 10 bidders, including NTPC, have submitted revised proposals around the Adani Group’s bid. This reflects strong competition that will also increase asset values.
Loans to lenders will be recovered
Industry insiders said this reflects IBC’s emphasis on extracting maximum value. Adani’s competitive bid takes KSK Mahanadi’s stated cash reserves from Rs 10,000 crore and trade receivables from Rs 4,000 crore to around Rs 27,000 crore. This means that lenders can recover 92 percent of the outstanding loan. KSK Mahanadi, located in Chhattisgarh, has an installed capacity of 1,800 MW. The project, with a debt load of around Rs 29.33 billion, entered the insolvency resolution process in 2019.
These companies also bid
Adani Power’s bid of Rs 12,500 crore was the highest bid among the competing entities. Big companies like JSW Energy, Jindal Power, Vedanta, NTPC and Coal India participated in this process. But their offers ranged from Rs 6,500 to Rs 7,700 crore. Subsequently, the creditors’ meeting decided to adopt the offer challenge system. Under the new system, the remaining plaintiffs have submitted higher offers.
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