In a one-of-its-kind debt resolution under Reserve Bank of India guidelines and outside NCLT process, a consortium of 10 lenders led by the Union Bank of India have assigned their debt exposure in amusement park firm Imagicaaworld Entertainment Ltd. to Aditya Birla ARC for ₹500 crore and picked up 10% stake in the company.
“This assignment was undertaken under the RBI guidelines of Prudential Framework for Resolution of Stressed Assets dated June 7, 2019 leading to a ‘Change in Management’ with lenders becoming equity shareholders as well,” said BOB Capital Markets Ltd., the 100% subsidiary of Bank of Baroda and the sole process advisor to the lenders.
Malpani Group (MPG), a Maharashtra-based diversified business group with presence in amusement park business, has acquired majority and controlling stake in Imagicaa by infusing ₹415 crore for preferential allotment of shares.
The Imagicaa account had NPA of about ₹1,000 crore and with interest the total exposure was estimated at ₹1,400 crore, BOBCAPS executives said.
Banks have received shares by converting part debt and their shareholding in the company is about 10%. They have also recovered ₹500 crore from debt assignment to Aditya Birla ARC, they added. “This is the first-of-its-kind transaction in listed entity space,” BOBCAPS said, adding that the overall recovery to lenders was 57%. Imagicaa’s assets included an amusement park, hotel and land. The theme park located in between Mumbai and Pune at Khapoli was set up by film producer Manmohan Shetty and opened to the public in 2013.
BOB Capital Markets acted as the sole process advisor to a consortium of 10 lenders led by the Union Bank of India, while Cyril Amarchand Mangaldas acted as the legal advisor to the lenders.
