Three prospective resolution applicants out of a list of 17 are in the final race for the Srei group NBFCs after late entries prompted the extension of the deadline for submission of resolution plans to December 2.

National Asset Reconstruction Company (NARCL), Authum Investment and Infrastructure, and the consortium of Varde Partners and Arena Investors have submitted resolution plans for Srei Infrastructure Finance and Srei Equipment Finance, which are currently under the corporate insolvency resolution process.

Following a meeting of the financial creditors of the Srei companies, a legal evaluation of the resolution plans will start and after that a commercial evaluation is expected.

The process of approval could be completed by mid-December according to sources.

However, there is no immediate clarity on the bid amounts. The benefit of upfront cash payments and security receipts backed by government guarantee makes NARCL a serious bidder.

The asset reconstruction company intends to acquire stressed assets with an upfront 15 per cent cash and the remaining 85 per cent in security receipts.

Meanwhile, Mumbai-based Authum Investment has acquired Reliance Home Finance and Reliance Commercial Finance and is looking to consolidate its presence in the NBFC segment.

The consortium of Varde Partners and Arena Investors is learnt to have submitted an improved resolution plan from its previous bid of around Rs 14,000 crore.

At that time, the other bid submitted by Shon Randhawa and her partner was around Rs 10,000 crore.

However, the creditors had not agreed upon the upfront cash payments offered by the two bidders in order to maximise the value of assets and a fresh expression of interest was called for by Srei administrator Rajneesh Sharma. Insolvency proceedings against SIFL and its subsidiary SEFL commenced in October 2021 after insolvency petitions filed by the Reserve Bank of India were approved by the Calcutta bench of the National Company Law Tribunal (NCLT).

The final date for completion of the CIRP process is scheduled on January 5, 2023.

The total admitted claims of the financial creditors of the two NBFCs are Rs 32,750.22 crore. Canara Bank, Union Bank of India, Punjab National Bank, State Bank of India, Bank of Baroda, Indian Bank, Punjab and Sind Bank, Central Bank of India, Uco Bank and Bank of India are the top 10 financial creditors of the Srei NBFCs.

The committee of creditors (CoC) would open financial bid of the resolution plans if it meets legal compliance.

After that, the plans will be put on vote for approval of the highest bidder.