The oldest asset reconstruction company, Arcil, said it is in final stages of taking possession of a large power plant with the Abhijeet Group.
The Abhijeet Group was setting up an 1100 MW coal-based power plant, Corporate Power, in Jharkhand, but could not complete it and also failed to service its loans.
Corporate Power had borrowed Rs 4,500 crore from a consortium of banks led by State Bank of India .
“We are looking to take possession of this company and hopefully once that is achieved, we could take it to the next level where the plant is completed,” Arcil managing director and chief executive Vinayak Bahuguna said.
Sources said Arcil paid only around 25 percent of the loan value to the bankers, which means banks have taken a huge 75 percent hair-cut from the deal. Arcil bought the plant from lenders late last year, Bahuguna said, adding that he is expecting all approvals over the next few weeks.
The move is as per the provisions in the Sarfaesi Act. The nearly 1,100 MW thermal power plant, situated in Latehar district of Jharkhand, was built in two phases but both of them are incomplete.
“The first phase is more than 75 percent completed and the second phase is 60 percent complete. First phase can get commissioned in about two years,” Bahuguna said.
Arcil has already organised a small health camp for the villagers around the plant and will look at a permanent medical facility and a school later on, he said. Bahuguna said in H1 of this fiscal Rs 48,000 crore of NPAs were put on sale but ARCs picked up only 7,000 crore.
“Up to H1, Rs 7,000 crore worth NPAs were picked up ARCs while the offering was of Rs 48,000 crore. One of the seven deal got consummated,” he said, adding that banks are likely to offer Rs 50,000 crore of bad loans in second half. Arcil had bought less than Rs 500 crore of NPAs during the period.