SBI to auction Rs 2200 crore loan to Bombay Rayon

SBI to auction Rs 2200 crore loan to Bombay Rayon

The State Bank of India has invited bids from asset reconstruction companies to offload a loan of Rs 2,200 crore given to Bombay Rayon Fashions after the apparel maker defaulted on repayments. SBI has kept a reserve price of Rs 900 crore, which is about 40% of the total loan. Banks have an exposure of nearly Rs 6,000 crore to the Mumbai-based company, which could be dragged to the bankruptcy court if a resolution plan is not in place before the end of August. As of June, lenders jointly hold 55% stake in the company, with SBI having the highest equity stake of 29%, followed by Axis Bank at 8% and the Union Bank of India at 3.3%. Other banks with marginal stakes include the Bank of India, PNB, Central Bank of India and Allahabad Bank. The promoters, Agarwal family, have a 38.3% stake in the company.

Read More at The Economic Times News date : 7 Aug 2018, Tuesday

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