Asset Reconstruction Company India (Arcil) is looking to take possession of Corporate Power’s thermal power plant in Jharkhand under the Sarfaesi Act, after the company’s loans were sold to it last year, Arcil managing director & CEO Vinayak Bahuguna said on Friday.
Bahuguna said the intention is to get the plant back on track. “We are looking to take possession by the powers vested on us under the Sarfaesi Act, and hopefully once that is achieved, we could take it to the next level where the plant is completed and gives power to people.”
Bahuguna said the 1080 MW power plant of Abhijeet Group was supposed to be built in two phases. “We are waiting to get authorisation to take possession,” he said, adding that one phase has been completed more than 75% and the other one is close to 60% complete.
“So one is quite close, I believe the first phase can get commissioned as quickly as two years.”
Last year, State Bank of India (SBI) and its subsidiaries had sold R2,400 crore of loans given to Abhijeet Group firm Corporate Power to Asset Reconstruction Company India Ltd (Arcil) at a discount of 77%. The company owed around R4,500 crore to a consortium of bankers led by SBI.
Manoj Jayaswal-led Abhijeet Group was alleged to be among the biggest beneficiaries of the controversial coal block allotments as part of which the company got blocks in Jharkhand and Chhattisgarh and was investigated by the Central Bureau of Investigation (CBI).
After being featured as a beneficiary, the group has been struggling to generate enough cash flow and repay its dues.
In 2013, the group had sought a recast of dues under the corporate debt restructuring (CDR) scheme for its companies — Corporate Ispat and Corporate Power. These were put on hold after the company failed to rope in a new investor by December 2013.
Based in Nagpur, the group is a diversified business entity with presence in the core sectors of power, roads, mining, EPC, ferro alloys, steel and cement.
Bahuguna said in the first half of FY16, bad loans worth Rs 7,000 crore were sold to ARCs, while the total offering was Rs 48,000 crore. Of Rs 7,000 crore, Arcil bought less than Rs 500 crore.
“In the fourth quarter, we should be able to acquire more assets. both the corporates and SMEs. I see the following 6-12 months promising intense activity in selling of loan books,” he said.