By Ankur Mishra
Lenders to Altico Capital have declared special situations fund SSG Capital as the highest bidder (H1) for the company, and the final voting on its resolution plan will take place on March 16, sources close to the development told FE. SSG Capital has offered Rs 2,750 crore upfront for the non-banking financial company (NBFC). Experts say the other key contender, Cerberus Capital, is technically not out of the picture yet as lenders can go back to it in case SSG Capital’s bid is not approved on March 16.
Ashish Pyasi, associate partner at Dhir and Dhir Associates, said, “As this process is not under the Insolvency Code and subject to bidding terms, Cerberus Capital can revise their bid to become the highest bidder and can continue to participate in the process.” Lenders would prefer a better value in the bidding process, he added.
The creditors of Altico were caught between the offers made by Cerberus Capital and SSG Capital. Private equity firm Cerberus Capital offered a little lower cash upfront of Rs 2,500 crore, compared with SSG Capital’s offer of Rs 2,750 crore. However, it promised an equity infusion of Rs 1,000 crore and security receipts of Rs 400 crore. So, in terms of net present value (NPV), Cerberus Capital’s plan was better than that of SSG Capital. However, in terms of cash upfront, SSG Capital scored more. SSG Capital’s resolution plan offered to sell off Altico Capital’s loan and close it later. On the other hand, Cerberus Capital offered to keep the company as a going concern.
Altico Capital has a total loan outstanding of Rs 4,300 crore, which includes term loans and non-convertible debenture (NCD). SBI, Yes Bank and Bank of Baroda are the key lenders to the NBFC.