Yes Bank ARC bid process enters final round as deadline ends Friday
The process to find investors for setting up an asset reconstruction company by Yes Bank enters the last stage with the deadline for submitting bids ending on Friday.
The private sector lender is planning to set up an asset reconstruction company to transfer its entire stressed pool of loans of Rs 50,000 crore so that its nonperforming assets become zero.
Among the investors submitted bids, three to four private equity players are expected to make it to the shortlist. These are JC Flowers and Company, Oaktree Capital, Cerberus Capital, and Apollo Global Management.
In the post earnings call with the investors, Yes Bank’s MD & CEO Prashant Kumar had said that the bank plans to complete the transaction of transferring stressed assets to the ARC by the end of the current financial year.
“We are trying to say do it by March end but because of the Covid uncertainties and regulatory approvals, it may slip to the next quarter i.e. the first quarter of the next financial year. But we are trying to conclude it by March end,” Mr Kumar said.
“We are actually in the process of setting up an ARC and we would like to shift our entire NPL portfolio to ARC. So, we would be expecting that once this transition is over, we would be having almost like zero NPL kind of thing,” Kumar added.
The bank has a stressed pool of Rs 50,000 crore, including technical write-offs.
While inviting Expression of Interest, the banks said the prospective investor should have minimum assets under management and funds deployed globally to the tune of $5 billion in the immediately preceding financial year. Also, the investor should have the ability to commit funds for investment or deployment in Indian companies or Indian assets or approximately $0.5 billion. EY is the process advisor for the deal. The bank will hold a 20 per cent stake in the ARC.
Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.
As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.
Support quality journalism and subscribe to Business Standard.