After receiving binding offers from a list of 25 accounts for sale, the bank held a Swiss auction for 5 accounts.
Only Jaypee Healthcare has drawn counterbids for Union Bank of India's Swiss Challenge auction, which is scheduled on July 5 and will include five problematic accounts. Shine Star Build-Cap, a business located in Delhi, placed the highest offer of Rs 72 crore to purchase the non-performing debt of the public sector lender. Suraksha Asset Reconstruction placed second with a proposal of Rs 65 crore.
Prior to this, on June 27, at an online auction, JC Flowers Asset Reconstruction had placed a legally binding offer of Rs 61.8 crore for the distressed asset.
In the event that JC Flowers is unable to match the highest price by July 11, Union Bank of India would proclaim Shine Star the victorious bidder for Jaypee Healthcare. JC Flowers will be deemed the winner bidder if its offer equals Shine Star's.
Indian Union Bank
On a petition filed by YES Bank, whose debt has now been allocated to JC Flowers, the Allahabad Bench of the National Company Law Tribunal entered Jaypee Healthcare into the corporate bankruptcy resolution process last month.
Union Bank, Exim Bank, Punjab National Bank, Bank of Baroda, and Asset Reconstruction firm (India) are among the other lenders to the firm.
As of March 2024, Union Bank of India owed Jaypee Healthcare Rs 68.56 crore, with a reserve price of Rs 61.7 crore. After the debt is allocated, the bank anticipates recovering more than 100% of its original loan. Jaypee Infratech owns all of the shares of Jaypee Healthcare.
The initial bidders were deemed victorious in the Union Bank of India's Swiss Challenge auction, after the other four accounts failed to elicit any counterbids.
Thus, the winning bids for Shree Saraiwwalaa Agrr Refineries are Prudent ARC's Rs 55 crore; RCM Infrastructure is won by Maximum ARC's Rs 27 crore; and GreenWorld International and Ram Chand Baboo Mal & Company are won by CFM Asset Reconstruction's Rs 16.29 crore bid.
For 25 non-performing accounts with a combined outstanding balance of about Rs 1,268 crore as of March 31, 2024, Union Bank of India requested bids from banks, asset reconstruction firms, non-banking financial enterprises, alternative investment funds, and financial institutions last month.
Of the 25 accounts the bank listed for sale, the two with the most debt were Leo Meridian Infrastructure Projects & Hotels, with a total outstanding of Rs 263.53 crore, and Shree Saraiwwalaa Agrr Refineries, with a total due of Rs 335.91 crore.
Through an electronic auction on June 27, Union Bank of India sought offers from interested parties on a fully cash basis for each of the accounts that were put up for sale. It listed 25 accounts for sale, and just five of them drew offers. The high reserve pricing imposed by the bank prevented any bids from being placed on the remaining accounts.
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