Srei Equipment Finance Limited (SEFL) confirmed that it has received expression of interest for up to $ 250 million capital infusion in the company. The international private equity (PE) funds are US-based Arena Investors LP and Singapore's Makara Capital Partners.
The company's Strategic Coordination Committee (SCC), chaired by Malay Mukherjee, Independent Director will coordinate, negotiate and conclude discussions with the PE investors to bring the capital into the business and advise the management. Ernst & Young (E&Y) will be advising the committee on the proposed fund raising exercise.
Arena Investors LP is a multi-strategy investment firm with $ 2.2 billion of committed capital. The firm's investment mandate is global, and also unconstrained in terms of asset class and industry. It provides creative solutions for those seeking capital in special situations.
Makara Capital Partners is a global financial services company under the regulatory purview of the Monetary Authority of Singapore (MAS). Founded in 2005, Makara Capital specialises in fund management, private equity as well as structuring and financing with a core focus on innovation, infrastructure and energy.
The SCC is running an independent process for investor identification and has received expression 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 the potential investors to raise fresh capital for the business, which will provide cushion against the pandemic induced stress in the Indian financial services space.
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.
Additionally, the board of directors of Srei Infrastructure Finance Limited (Srei) and its wholly-owned subsidiary Srei Equipment Finance Limited (SEFL) held meetings on April 23, 2021. SEFL announced that it has further received an expression of interest (EoI) for capital infusion from Cerberus Global Investments B.V. Established in 1992, Cerberus comprises one of the world's leading private investment firms with approximately $ 53 billion under management across multiple strategies. Cerberus is headquartered in New York City, USA, and has advisory offices in Mumbai, Tokyo, Hong Kong, Singapore, Beijing, London, Dublin, Dubai, Madrid and Frankfurt, among others.
SEFL has also announced the appointment of Justice Deepak Verma as an Independent Director on its board w.e.f April 23, 2021. Verma's career in law spans over four decades and combines extensive practice at the bar and distinguished service in the Indian judiciary. He was the Judge of the Hon'ble Supreme Court of India and now acts as an independent mediator and arbitrator in domestic and international disputes as well as an expert on matters of Indian law before foreign courts and international tribunals.
The company had anticipated the impact of Covid-19 on its customers and the cascading effect the pandemic would have on its loan recovery efforts. SEFL had proactively approached the Hon'ble National Company Law Tribunal (NCLT) with a scheme that proposed repayment of the loans that it had borrowed in an orderly manner over a period of time.
SEFL plans to repay its loans through the recoveries and hence the scheme was submitted to all the creditors to realign the repayment schedule with expected collections from customers. The lenders also have the flexibility to make necessary amendments in the proposed schemes.