Sankalp Recreation, Shri Ram Multicom and Rare ARC Compete For Hotel Business of Rajesh LifeSpaces

Image Credits: economictimes.indiatimes.com

Mumbai:

Sankalp Recreation of Ahmedabad, Shri Ram Multicom of Kolkata, and Rare Asset Reconstruction Co are the only candidates left in the contest to acquire the now-defunct hotel property of real estate company Rajesh Life Spaces in Mumbai, after 13 rounds of tendering. 

Resurgent Resolution Professionals, the valuer retained by the banks, will now evaluate the three candidates' various proposals. Lenders will vote on the best plan based on the net present value based on the valuer's report. 

"Each of the three proposals has a unique structure, and financiers are currently awaiting a report from Resurgent to determine which one can be designated as the preferred bid. The bidding has been robust, exceeding expectations, and is now significantly higher than the benchmark price of INR 305 crore set by the creditors, according to a person familiar with the bidding process.

Sankalp Recreation has submitted the maximum bid of INR 533 billion, but the majority of payment is deferred. It has offered 30 crore INR up front, 20 crore INR within 30 days, and the remaining 483 crore INR within 300 days. 

Shri Ram Multicom has proposed a price of INR 474 billion, payable over ninety days. Rare ARC has offered INR 461 crore up front in addition to INR 31 crore in company equity.

This month, lenders scheduled an online challenger bid auction after multiple bidders expressed interest in the assets. A challenger proposal is one in which the purchaser matches or exceeds the highest bid in each round until there is no one left to do so. 

DMart promoter Radhakishan Damani's investment vehicle Bright Star Investments was also among six initial suitors, but did not pursue the deal after the initial rounds.

Raiesh Business & Leisure Hotels had partnered with Singapore-based GHM Hotel to operate a 316-room five-star hotel under the 'The Chedi' brand at Kanjurmarg near Mumbai's Powai neighbourhood.

Due to a lack of cash, the company was unable to conclude the endeavour. Since 2019, Rajesh Business has been classified as a non-performing asset on bank balance sheets. ICICI Bank has the highest exposure to the company at INR 331 crore, followed by Bank of Baroda and Union Bank of India. Their exposure is external Commercial loans and bank guarantees.