The e-auction for the sale of SREI twin companies — SREI Infrastructure Finance Limited (SIFL) and SREI Equipment Finance Limited (SEFL) — under the Insolvency and Bankruptcy Code (IBC) kicked off today with three suitors in the fray.

The three suitors include a consortium of Varde Partners and Arena Investors, the National Asset Reconstruction Company or NARCL as well as Authum Investments. The e-auction will take place under the challenger mechanism with a base bid of Rs 4,500 crore.

CNBC-TV18 learns that the Rs 4,500 crore is in terms of net present value basis and it includes a minimum cash component of Rs 3,000 crore.

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However, the SREI Group companies already have around Rs 2,200 crore of cash sitting on their books and that will be included as part of the overall bids that the lenders consider.

In the previous round, the highest bid had come in from the Varde-Arena consortium and was about Rs 14,000 crore followed by NARCL at about Rs 13,500 crore and Authum Investment at Rs 3,400 crore.

But, the cash component was very low and the bulk of the offer was in the form of debt instruments which is why now lenders have put the base at Rs 4,500 crore in net present value terms.

There will be 5 rounds of the auction and at the end of it, the player that makes the highest offer will be declared the winning bidder.

First Published:Jan 3, 2023 6:24 PM IST