The Administrator of two insolvent Srei companies has obtained the Reserve Bank of India’s approval for the National Asset Reconstruction Company (NARCL) as a ‘fit and proper’ state-backed company. Rajneesh Sharma, the administrator, has submitted the resolution plan to the Kolkata bench of the National Company Law Tribunal (NCLT) for its approval. The consolidated committee of creditors (CoC) for the two Srei companies approved NARCL’s resolution plan, which received the highest voting share among bidders.
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On March 23, the Administrator received a ‘No Objection’ letter from the RBI for NARCL, and he submitted it before the NCLT on the following day. The tribunal is presently hearing the case related to Adisri Commercial, the former promoter company of two insolvent Srei firms, urging it to set aside its order that admitted the debt-laden firms for insolvency proceedings and consider an application for the creditors’ new settlement offer. Adisri Commercial, which holds about 60% of Srei Infrastructure Finance (SIFL), questioned the NCLT’s order for initiating the corporate insolvency resolution process (CIRP) against SIFL and its subsidiary Srei Equipment Finance (SEFL).
The Kanorias, the former promoters of the two Srei companies, proposed withdrawing SIFL and SEFL from insolvency proceedings under Section 12A of the IBC. The erstwhile promoters submitted a resolution offer that creditors’ entire claims of approximately Rs 32,000 crore would be repaid using multiple financial instruments over time. Authum Investment and Infrastructure, whose financial bid was the second-highest in net present value (NPV) terms, filed a petition before the tribunal, challenging the process adopted by the CoC for the Srei companies, in which NARCL became the highest bidder.
