Reliance set to take over JBF Industries with CFM ARC

By: |
September 22, 2021 5:00 AM

Bankers had sought takeover bids in July, and the Ahmedabad-based CFM ARC is understood to have put in a `825-crore bid for the company, which owes its lenders Rs 2,116 crore.

Emails sent to RIL, CFM ARC and Bank of Baroda remained unanswered till the time of going to press.Emails sent to RIL, CFM ARC and Bank of Baroda remained unanswered till the time of going to press.

Reliance Industries (RIL) is likely to take over stressed polyester manufacturer JBF Industries in consortium with CFM Asset Reconstruction Company (ARC), two people aware of the matter told FE.

Bankers had sought takeover bids in July, and the Ahmedabad-based CFM ARC is understood to have put in a `825-crore bid for the company, which owes its lenders Rs 2,116 crore.

The auction was in the form of a Swiss challenge, where banks ask interested bidders to better an existing bid for an asset. The original bidder gets the right of first refusal. In the case of JBF Industries, the RIL-backed bid by CFM ARC is understood to be the only one.

The lead lender to JBF Industries is Bank of Baroda, with an outstanding amount of `500 crore. The other lenders include Canara Bank, Bank of India, Union Bank of India, IDBI Bank, ACRE, Standard Chartered Bank, ICICI Bank, Indian Overseas Bank, DBS Bank, Axis Bank, IFCI and South Indian Bank.

Emails sent to RIL, CFM ARC and Bank of Baroda remained unanswered till the time of going to press.

According to a bid document, JBF Industries is engaged in the production of products in the polyester value chain, such as PET chips, which are of bottle grade, textile grade and film grade; polyester yarn, such as partially oriented yarn, polyester filament yarn, full drawn yarn and other specialised yarn; and PET films, which are of thin grade, thick grade and metallised grade. The company defaulted on its debt obligations due to its weakened liquidity position, according to a rating report by Care Ratings.

In 2020, RIL had acquired a 37.7% stake in textile firm Alok Industries through the insolvency resolution process. It had participated in the bidding process for the company in consortium with JM Financial ARC.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.

Next Stories
1Apple macOS Monterey rollout today but Intel-powered Mac users will miss out on these features
2Jaguar I-Pace: Tesla-catcher
3Carbon capture and storage: Another arrow in the green quiver