Adani’s ‘Stress’ Buster: Group Wins Three Out Of Seven Stressed Assets In Power Sector Under Samadhan SchemeGautam Adani, chairman of Adani Group (Abhijit Bhatlekar/Mint via Getty Images)

Adani Group has emerged as the highest bidder to acquire three stressed power projects out of the seven that underwent resolution outside the insolvency code, reports Mint.

The group, headed by Gautam Adani, will acquire three firms - Coastal Energen Pvt Ltd, KSK Mahanadi Power Ltd (₹17,194 crore) and GMR Chhattisgarh Energy Ltd (₹8,174) - as part of the resolution plan approved by a group of Indian lenders, led by State Bank of India. Together, these companies which owe Rs 31,500 crore to the banking system.

The deal has been formulated under the Scheme of Asset Management and Debt Change Structure (Samadhan).

The scheme stipulates that a stressed power company’s debt be divided into sustainable and unsustainable segments. While the new owner takes the former, the latter is converted into equity.

A total of seven projects, with a cumulative debt of Rs 74,000 crore are being resolved through this route. Also, by resolving stressed assets outside of the Insolvency and Bankruptcy Code (IBC), it helps to prevent delays in deciding the cases.

New measures to relieve stress

In September 2018, the NDA government approved a series of measures like the auction of power supply contracts with attached coal suppliers, permitting coal usage for short-term power contracts and tweaking the payment mechanism to help power projects recover dues from state electricity distribution companies.

These measures will help release almost Rs 15,000 crore owed to private sector companies. These funds can later be used to make repayments on loans.

Also Read: Revamping Old Thermal Power Infrastructure - Power Sector’s Newest Opportunity

An Appeal...

Dear Reader,

As you are no doubt aware, Swarajya is a media product that is directly dependent on support from its readers in the form of subscriptions. We do not have the muscle and backing of a large media conglomerate nor are we playing for the large advertisement sweep-stake.

Our business model is you and your subscription. And in challenging times like these, we need your support now more than ever.

We deliver over 10 - 15 high quality articles with expert insights and views. From 7AM in the morning to 10PM late night we operate to ensure you, the reader, get to see what is just right.

Becoming a Patron or a subscriber for as little as Rs 1200/year is the best way you can support our efforts.

Become A Patron
Become A Subscriber
Advertisement