NARCL to take over debt of Sri Govindaraja for ₹270 crore
bad loan aggregator National Asset Reconstruction Co (NARCL) is set to take over the distressed textile company Sri Govindaraja Mills after its ₹270 crore offer to lenders did not receive competing bids.
Chennai-based Sri Govindaraja has been a non-performing asset for five years and owes creditors led by Canara Bank more than ₹750 crore. The ₹270 crore offer from NARCL equates to a 36% recovery for lenders. NARCL will pay banks through a mix of 15% cash upfront and 85% security receipts which can be redeemed later.
This is the second asset NARCL has been selected as the winning bidder. Last month its ₹300 crore offer for ₹1,773 crore loans in Bareilly Highways Project received no counterbids during a Swiss challenge auction.
«Govindaraja timeline ended earlier this month. Since no counteroffers were received, NARCL will take over the account. Paperwork including arranging of specific government guarantees is being drawn up and this account will be soon transferred to NARCL,» said a person familiar with the matter.
NARCL did not reply to an email seeking comment.
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