Lenders reject Rs 2,800-crore Vedanta offer for Lanco unit

Lenders have rejected ‘s Rs 2,800 crore offer for Lanco Amarkantak Power, a Lanco Group company that is undergoing Insolvency and Bankruptcy Code (IBC) proceedings at National Company Law Tribunal (NCLT), according to sources in the know.

Vedanta’s offer had been put to a vote after it was found to be better than a rival offer from iLabs Group. However, its offer failed to get the requisite approval of two-thirds of the creditors who are entitled to vote in the committee of creditors meeting, according to sources.

IBC regulations require that over two-thirds of financial creditors must vote in favour of an offer for a company’s sale to be approved.

A group of 14 banks have filed claims worth Rs 14,000 crore for recovery of debts from the company.

Lenders are evaluating options including inviting fresh bids, according to sources. They feel the valuation offered by Vedanta is low as the company owns operating power plants.

Amongst the major lenders are Axis Bank,

, , LIC and Edelweiss ARC. Vedanta could not be reached for comment. Lanco Amarkantak Power’s resolution professional Saurabh Tikmani declined to comment.

Lanco Amarkantak Power was incorporated in February 2001 and has coal-fired thermal power units on 1,337 acres of land near Pathadi village on the Korba-Champa state highway in Chhattisgarh.

The company has two units of 300 MW each that currently supply electricity to Madhya Pradesh, Haryana and Chhattisgarh. The second phase of two units of 660 MW each has been delayed beyond the targeted commissioning in 2016-17. Work on the third phase to add two more units of 660 MW each has not started.


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