NCLT approves Sarda Energy’s Rs 22 billion acquisition of SKS Power 

The National Company Law Tribunal (NCLT) has approved the acquisition of bankrupt SKS Power Generation by Sarda Energy & Minerals for Rs 22 billion. This acquisition allows Indian banks, which have an exposure of Rs 18.9 billion, to recover their entire amount from the electricity generation firm. SKS Power Generation owns a 600-MW power plant in Chhattisgarh, currently operated by NTPC.

The committee of creditors, led by State Bank of India (SBI) and Bank of Baroda (BoB), unanimously approved Sarda’s resolution plan. SKS Power, with its coal supply, was a sought-after asset under the Insolvency and Bankruptcy Code (IBC), especially as coal-based projects for sale are scarce. The company defaulted on loans worth Rs 18.9 billion to SBI and BoB in April 2022, leading to its referral to the bankruptcy court.

Previously, Hong Kong-based Agritrade Resources had purchased the plant from Indian lenders in November 2018 through a one-time settlement, but it later fell into financial distress. SKS Power Generation was originally set up by Anil Gupta of SKS Ispat. In May this year, the National Company Law Appellate Tribunal (NCLAT) permitted Sarda Energy to seek NCLT’s clearance for its offer. Seven companies, including Vantage Point Asset Management Pte and Torrent Power, had submitted bids for SKS Power.