June 22, 2018
Adani Wilmar, the highest bidder in variance to attain debt-laden Ruchi Soya, has secured Rs. 4,000-crore credit from Standard Chartered and DBS to finance its likely acquisition of the country’s largest edible oil maker.
Ruchi Soya is one of 40 companies that had been identified by the Reserve Bank of India to be referred to the bankruptcy courts for effective debt resolution.
Both Standard Chartered and DBS currently have exposure to Ruchi Soya and were among the first ones to report the case to National Company Law Tribunal (NCLT).
“The credit lines are secured,” said one of the sources. “It’s a normal bridge loan, with tenure of 18 months. This is secured with the existing facilities, which both the banks have with Ruchi Soya as well as corporate guarantees from Adani Wilmar,” said the source.
The joint venture between infrastructure conglomerate Adani Group and Singapore-based Wilmar International nearly doubled its earlier bid to trump Baba Ramdev-led Patanjali Ayurved, which was the lead contender for Ruchi Soya till the penultimate round of bidding process.
“IBC (Insolvency & Bankruptcy Code) has triggered a number of fund raising activities,” said Nilang Desai, partner at law firm AZB & Partners. “It has created demand for funding proposed acquisitions. Banks too see it an opportunity to expand credit with credible counterparties serving their debt,” he said.
Adani Wilmar emerged the highest bidder for the company with an offer of Rs 5,474 crore, which includes Rs 4,300 crore as payment to lenders. Patanjali had offered Rs 5,765 crore, but it included only Rs 4,065 crore for payment to lenders.
Financial creditors to the company have submitted a claim of Rs 10,493 crore to the resolution professional for Ruchi Soya, while operational creditors have made a claim of R.s 36 crore.
State Bank of India has the highest exposure of Rs 1,822 crore in the company, followed by Central Bank of India with Rs 824 crore. Standard Chartered has an exposure of Rs 607 crore, while DBS Bank has a claim of Rs 242 crore with Ruchi Soya.