GMR Chhattisgarh underwent strategic debt restructuring in 2017. Under the SDR scheme, of the total outstanding debt of Rs 8,800 crore, debt to the extent of Rs 2,992 crore was converted into equity due to which the consortium lenders got 52.4 per cent stake, while the balance remained with GMR.
The lenders have been looking to sell the project for a year now, but RBI’s regulations on Insolvency and Bankruptcy Code (IBC) and litigation stalled the process. In a circular issued on February 12, 2018, the RBI allowed 180 days to the lenders for debt resolution of large defaulters, failing which, the asset would have to be taken to NCLT for initiation of insolvency. The deadline got over on August 31, 2018
The power sector, through its representative bodies, Essar Power, GMR Energy, KSK Energy, and Rattan India Power, had moved the Supreme Court challenging the constitutional validity of RBI's February 12 circular. The Supreme Court quashed the circular this April, and denied all resolution processes arising after it.
The revised circular issued earlier this month has increased the review period of default to 30 days. “During this review period, lenders may decide on the resolution strategy, including the nature of the resolution process, the approach for implementation of the resolution process etc. The lenders may also choose to initiate legal proceedings for insolvency or recovery,” said the circular.
Of the 30 identified stressed projects, a dozen are already with the NCLT for insolvency proceedings. There are seven projects where the resolution process is ongoing outside the IBC. Leading sector lender Power Finance Corporation (PFC) said they have submitted afresh three projects in the NCLT again which includes two thermal power projects of Rattan India.