NARCL to take over Rs 1000 crore Kay Bouvet debt

Mumbai: The government-backed bad loan aggregator National Asset Reconstruction Co Ltd (NARCL) is set to take over the Rs 1000 crore debt of specialised equipment maker Kay Bouvet Engineering after its Rs 130 crore offer did not receive a challenging bid, people familiar with the details said.

Banks led by IDBI had sought a challenging bid to NARCL’s Rs 130 crore offer earlier this month with due diligence for prospective bidders ending on March 23.

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No bidder came forward till the end of the day on March 24, the final day for bids in the Swiss challenge auction, as a result banks are now moving ahead with the transfer to NARCL.

Under a Swiss challenge auction, the sellers invite challenges for the main bid to better the offer. The original bidder is given the right to match the best competing offer, ensuring competitive pricing while rewarding innovation. The NARCL offer means a 13% recovery for banks and will be in the mix of 15% cash and the rest in security receipts to be redeemed on recovery.

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Kay Bouvet is a heavy engineering company engaged in design, engineering and manufacturing of specialised equipment for strategic industries like nuclear energy, power, defence and space. The company has two manufacturing facilities in Maharashtra and Haryana. This acquisition could be the last for NARCL this fiscal.