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NARCL to buy loans of five distressed companies, lenders agreement awaited

In July, NARCL had proposed to take distressed assets of 17 firms worth Rs 93,249 crore including included five firms of the Future Group

Topics
bad bank | Future Group | bankruptcy proceedings

BS Web Team  |  New Delhi 



NARCL

The government-owned National Asset Reconstruction Company of India (NARCL) has reportedly offered to acquire the distressed loan accounts of five including . According to a report by The Economic Times (ET), the binding offer will only be made after NARCL receives written consent from lenders.

The other that have been offered to transfer the loan accounts are GTL Ltd, McNally Bharat Engineering, Consolidated Construction and Rainbow Papers.

NARCL, according to ET, had earlier stated that it will only make a binding offer if 75 per cent of the lenders agree. It would give NARCL control over the resolution process. The out-of-court settlement will also take place if 75 per cent of the lenders agree.

Also Read | NARCL to start operation with Rs 50,000 cr stressed loan by Sep: PNB MD

Out of the five firms, Future Retail, and CCCL are already undergoing insolvency proceedings. owes Rs 17,511 crore to the creditors. McNally Bharat owes Rs 4,840 crore and CCCL owes Rs 2,693 crore to the creditors. GTL has to pay Rs 4,866 crore to the lenders.

Rainbow papers has filed for for the second time, the report added. Earlier creditors had rejected NARCL's offer of a 10 per cent recovery.

In July, NARCL had proposed to take of 17 firms worth Rs 93,249 crore. This included five firms of the namely Future Retail, Future Enterprises, Future Lifestyle Fashions Ltd, Future Supply Chain Solutions and Future Consumers.

Selling loans to NARCL guarantees that the loans be paid by the Asset Restructuring Company (ARC) if the company fails to pay the dues at the end of five years.

NARCL, however, has failed to strike any deal as of now due to a lack of clarity on how government guarantees would work.


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First Published: Thu, August 25 2022. 14:26 IST

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