Private equity funds — US-based Arena Investors LP and Singapore’s Makara Capital Partners – have expressed interest in investing up to $250 million in Srei Equipment Finance.

The non-bank finance company on Thursday said that a strategic coordination committee (SCC) consisting of independent directors announced last month will coordinate, negotiate and conclude discussions with the private equity investors to bring capital into the business and advise the management.

Ernst and Young will advise the committee on the proposed fund raising exercise.

“The SCC is running an independent process for investor identification and has received expressions of interest from Arena Investors LP and Makara Capital Partners. This process is being carried out in parallel to the debt realignment plan. The SCC will engage in discussions with potential investors to raise fresh capital for the business,” Srei Equipment Finance said in a statement.

“The SCC will also be the nodal point for a comprehensive cash flow realignment plan with banks and financial institutions and for all external service providers, including investment bankers, lawyers and consultants,” the statement added.

The NBFC’s cash flow has come under stress because of asset liability mismatch. While the company has offered moratorium to eligible borrowers, it was not allowed moratorium by its lenders.

Srei chairman Hemant Kanoria in a letter to non convertible debenture holders has sought to address concern of the investors over repayment of liabilities. He said that the company had anticipated the challenging situation and approached NCLT with a scheme of proposed repayment of loans.

“We wish to assure our investors that the collateral/securities against the loans given by your company together with the receivables are sufficient to repay all the liabilities in an orderly manner over a period of time,” said Kanoria in the letter.

“We have already initiated necessary steps in this regard including aggressive sell down of assets, reduced disbursements and attempt to re-profile our liabilities...The present asset liability profile needs time to be corrected to the current dispensation and we need support and guidance from the RBI and our banking partners to ensure effective transition of our business model,” the letter said.

RBI has conducted a special audit into the books of the lender.