Sarda Energy & Minerals, a Chhattisgarh-based vertically integrated producer of steel that also owns captive iron ore mines, outbid the Naveen Jindal group and Torrent Power in a bidding process for the company, which is being administered by a resolution professional, the sources said.
Bank of Baroda and State Bank of India are the lenders to SKS Power Generation (Chhattisgarh). Their outstanding dues from the company including principal and interest amount to ₹1,800 crore, as per records available with the Insolvency and Bankruptcy Board of India.
“The winning offer provides the lenders not only full recovery but also some upside in the long term from the performance of the company,” a person aware of the matter said.
Sarda Energy & Minerals and Ashish Rathi, resolution professional for SKS Power Generation (Chhattisgarh), did not respond to ET’s queries until press time Friday.SKS Power Generation (Chhattisgarh) had drawn interest from several bidders including Adani Group and Reliance Industries at a preliminary stage. Eventually, those two backed out of the process.The company has two power plants each with the capacity to generate 300 MW of power. The company had been ailing because the second power plant was not operational. During the insolvency process, the lenders infused interim finance in the company to operationalise the second power plant. The company became profitable after the second plant was started.
Sarda Energy & Minerals is said to have bid aggressively for the company because it also owns coal mines near the power plants of SKS Power Generation (Chhattisgarh) and has easy access to fuel, making the production of power more cost-effective.
Torrent Power is said to have shown interest in the company because it owns electricity distribution licences and the acquisition of a power producer would have helped it have an integrated business model. Naveen Jindal group also owns coal mines and its acquisition strategy was based on similar lines of Sarda Energy & Minerals.
