MUMBAI: Asset reconstruction companies (ARCs) are lining up for the bankrupt ACCIL Corp‘s ₹270 crore debt in what is turning out to be a rare 100% recovery for banks. The asset in question is an ACCIL-owned hotel in Jaipur, which has been put on block by lenders to recover their dues.
Last month, Omkara ARC beat competitor Asset Reconstruction Company of India (Arcil) with a ₹38 crore cash offer to Chennai-based Indian Bank in a Swiss challenge. Separately, Arcil has emerged as the preferred bidder to take over the ₹113 crore debt owed to Union Bank of India, the lead lender in the case.
“This is a rare case where 100% principal recovery is possible because ARCs have got interest from investors wanting to own a hotel in Jaipur. The hotel itself is coveted because it’s a rare working hotel available on a distressed sale, which is valued highly due to the strong rebound in the hospitality business post-Covid,” said a person familiar with the process.
Emails sent to Arcil, Omkara, Union Bank and Indian Bank did not elicit any response.
ACCIL Corp owns the 170-room hotel in Jaipur, which is being managed under the Holiday Inn franchise. Interest in the property is strong because it’s a hotel in working condition in a city frequented by tourists. Besides Indian Bank and Union Bank, other creditors to the company are Central Bank of India and Indian Overseas Bank (IOB).
Omkara’s bid of ₹38 crore for Indian Bank includes full principal payment together with some interest dues. Similarly, Arcil has also agreed to pay the full principal amount in its offer to Union Bank, which is the largest creditor in this case.
“Arcil had initially bid a lesser amount but has substantially increased its bid in the Swiss challenge round noting the strong competition. No challenger came in the Swiss challenge as a result of which Arcil is now the preferred bidder,” said a second person aware of the process.
It is unclear as to what other lenders Central Bank and IOB are planning with their debt.
