Asset Reconstructions Company of India (ARCIL) and Cerberus Capital have pulled out of the race to acquire over Rs 48,000 crore of Yes Bank’s distressed loans. They did not submit counter bids to JC Flowers ARC’s binding offer, The Economic Times reported on September 9, citing two sources aware of the development.
Yes Bank is expected to declare JC Flowers as the winner “soon” and will have virtually zero bad loans after the transfer is complete, it added. JC Flowers had placed a bid worth Rs 11,183 crore for Yes Bank’s distressed loans and invited counter bids till September 7.
Moneycontrol could not independently verify the report.
Rahul Gupta, Chairman and CEO of JC Flowers ARC declined to comment on the development. ARCIL and Yes Bank did not respond to the queries sent by ET.
One source said that ARCIL and Cerberus pulled out after Avenue Capital, which owns a majority stake in the former, failed to reach an agreement, as per the report.
The Cerberus-ARCIL team up came after Yes Bank indicated it would prefer selling to bidders with an operational ARC and in May favoured JC Flower’s bid over Cerberus’ offer, the source added. These talks however remained inconclusive.
Notably, JC Flower’s Rs 11,183 crore bid was the highest one made and comprised of 15 percent cash consideration — i.e. Rs 1,677 crore upfront, and the balance as security deposits — to be deemed as the ARC recovers the loans.
Among the loans that will change hands include Yes Bank’s exposure to the Anil Dhirubhai Ambani Group, Essel Group and Radius Group.
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