Cyril Amarchand advises on resolution plan for NBFCs

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CAM NARCL IDRCL NBFC resolution
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Cyril Amarchand Mangaldas has advised the National Asset Reconstruction Company Limited (NARCL) and the India Debt Resolution Company Limited (IDRCL) on the resolution plan for two non-banking financial companies (NBFCs) under insolvency proceedings.

“This was one of the biggest deals for the NARCL and we were involved deeply with structuring and execution of the deal. The superb teams at the NARCL and IDRCL worked closely with us. In deals of this magnitude, technical analysis and stakeholder management are of foremost importance for the advisers. We were able to be practical and solution-oriented in the midst of some very tricky commercial and legal issues,” said partner Dhananjay Kumar, who led the Cyril Amarchand Mangaldas team.

The Cyril Amarchand Mangaldas team involved the insolvency and restructuring, disputes, general corporate and competition law practices. The team conducted due diligence on both companies, and drafted and negotiated the resolution plan. The team also represented the NARCL in court proceedings, assisted in implementing the plan, handled regulatory approvals and drafted the documents. Cyril Amarchand Mangaldas worked alongside the administrator, financial advisers for the committee of creditors, and transaction advisers.

The restructuring process began in October 2021 when the Reserve Bank of India appointed an administrator for the SREI companies. Subsequently, the National Company Law Tribunal (NCLT) commenced insolvency proceedings, leading to the consolidation of the companies’ resolution processes in February 2022. The committee of creditors approved the resolution plan, which the NCLT subsequently approved in August 2023.

SREI Equipment Finance is a wholly owned subsidiary of SREI Infrastructure Finance. Financial creditors had claimed INR327.5 billion (USD3.9 billion) in debt was owed.

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