Details of the Transaction (Including unique traits, if any)

The lenders to PPGCL invoked pledge over equity and preference shares due to delays in debt servicing by PPGCL. The lenders then initiated process to sell the majority shareholding in PPGCL to a new investor(s).

Resurgent Power Ventures Pte Limited was declared as the successful bidder in 2018 and SPA was signed on after receipt of Lenders’ approvals. However, it took lenders more than one year in fulfilling CPs to the transaction including arranging for an NOC from UPPCL, the PPA counter party and transaction was closed on December 4, 2019.

Key Learning

• Adequate time be given to the prospective bidders for due-diligence and to submit the bid.  
• Minimum variable components in the bids: The bid from JSWEL though acceptable to the lenders, could not be concluded as JSWEL indicated adjustment of ~Rs. 2200 Cr. from the OTS offer and Lenders had to re-invite the bids.
• Minimal CPs to be accepted by lenders: Obtaining the UPPCL NOC, though not required under PPA, was agreed to be arranged by the Lenders which delayed the transaction by almost a year. Similarly, getting IT clearance under section 281 was a herculean task and had to be waived finally