Deal Closed | State Bank of India | Advisory to Consortium of Banks on Financial Arrangements with CG Power

The details of the deal are as follows:

Sector: Financial Services – Restructuring  

Completion Date: 31-Dec-2020 

Name of Client: The consortium of lenders comprising of State Bank of India (acting as the Lead Bank) 

1. Union Bank of India 
2. Bank of Maharashtra 
3. Canara Bank 
4. ICICI Bank Limited 
5. IDBI Bank Limited 
6. Standard Chartered Bank 
7. Barclays Bank PLC 
8. Axis Bank Limited 
9. Yes Bank Limited 
10. Aditya Birla Finance Limited 
11. IndusInd Bank Limited 
12. Bank of India and SBM Bank (India) Limited  

Acquirer Details: Tube Investments of India Limited | India  

Target Details: CG Power and Industrial Solutions Limited  

Deal Description: The firm acted as the lenders’ legal counsel to a consortium of 14 lenders led by State Bank of India (“Lenders”) in relation to the resolution of the outstanding debt facilities of an aggregate amount of INR 2931.87 crores extended by the Lenders to CG Power and Industrial Solutions Limited (“CG Power”). The resolution of CG Power being first of its kind was undertaken in terms of the RBI’s Prudential Framework for pre-insolvency resolution and involved change of control of CG Power which was acquired by Tube Investments of India Limited, a Murugappa group company (“Bidder”) and compromise settlement with the Lenders. 

Total Consideration: INR 1000 crore (USD 138.6 million) 

Team Members: The core team consisted of Haigreve Khaitan (Partner), Kumar Saurabh Singh (Partner), Ahana Sinha (Principal Associate), Riya Agicha (Senior Associate) and Deboshree Mukherjee (Associate) with assistance from the following: 

Real Estate aspects: Harsh Parikh (Partner), Abhiraj Gandhi (Partner) and Meherasp Mistry (Associate) 

Corporate aspects: Kartick Maheshwari (Partner) and Shantanu Gupta (Partner) 

Capital Market aspects: Abhimanyu Bhattacharya (Partner), Aditya Cheriyan (Partner) and Oishik Bagchi (Principal Associate) 

Due Diligence: Devidas Banerji (Partner), Anshuman Jaruhar (Counsel), Ashwij Ramaiah (Associate),  Arindam Bhattacharjee (Associate), Abhimanyu Phadke (Associate) and Oishani Banerjee (Associate) 

Role of Firm: As the Lenders’ legal counsel, the Firm has worked on the following: 

Undertaking due diligence of financing arrangement of CG Power;  

Drafting, reviewing, negotiating, revising and finalising the documents for the swiss challenge bid process, resolution plan of the Bidder and Transaction Documents; 

Advising on compliance with Prudential Framework, RBI Directions on Fraud, etc.; and  

Supervising the completion of the conditions precedent to the compromise settlement. 

Other legal advisors:  

Legal advisor to the Bidder: Cyril Amarchand Shroff  

Legal advisor to CG Power: Trilegal 

Unique Feature of Transaction: First successful debt resolution under Prudential Framework for a company whose account was declared as fraud by its lenders. 

Delinking CG Power from its erstwhile management.  

Completion of the transaction within 5 months from receipt of the resolution plan following the swiss challenge bidding process.