TVS Group, along with a clutch of special situation investors like AION Capital, India Resurgence Fund - a consortium of Bain Capital and Piramal Group, and SSG Capital Management, are in preliminary talks to put fresh equity capital worth Rs 500 crore ($65.6 million at current exchange rate) in CG Power and Industrial Solutions.
If successful, the transaction will be followed by an additional infusion of working capital credit from the lenders that may help put the fraud-hit company back on its feet, persons with knowledge of the matter told The Economic Times.
Company’s founder chairman Gautam Thapar was removed last August after a probe revealed financial and governance irregularities.
On Friday, current chairman Ashish Guha confirmed to The Economic Times that the lenders’ consortium is working to infuse equity capital and work out a debt resolution plan.
Last week, VCCircle had reported that CG Power, a distressed company backed by private equity firm KKR, had appointed Arpwood Capital Pvt. Ltd as its financial adviser to help raise equity funding.
CG Power owed Rs 2,485.5 crore to 14 lenders including IndusInd Bank, State Bank of India, ICICI Bank, Axis Bank, Canara Bank and IDBI Bank as of March 2019, its annual report shows.
Established in 1937, CG Power makes transformers, switchgear, circuit breakers, network protection and control gear, and power automation products. It also offers turnkey solutions.
Meanwhile, Everstone Capital is in advanced talks to sell up to a 5% stake in Burger King India to Oman India Joint Investment Fund, for close to Rs 150 crore ($19.7 million at current exchange rate), people aware of the development told The Economic Times.
Everstone Capital, through its investment vehicle QSR Asia Pte. Ltd, owns 99.39% stake in Burger King India.
Earlier this month, Burger King India postponed the launch of its Rs 1,000 crore initial public offering, in which Everstone was reported to be selling at least a fourth of its stake, after markets globally underwent a meltdown due to the coronavirus pandemic.