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Restructuring Status Update Deck- Vol IV

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Aurum Equity Partners LLP, set up by a team of qualified and experienced professionals, an Investment Banking Firm, focused on Mergers & Acquisitions, Fund Raising, Restructurings and Corporate Strategic Advisory.

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Restructuring Status Update Deck- Vol IV

  1. 1. Restructuring & Insolvency Situations in India Status Update- Volume IV January 2018
  2. 2. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITEDDisclaimer • This document is presented solely for the internal use of the recipient to whom it is marked by Aurum Equity Partners LLP (Aurum) and Integrated Capital Services Ltd (ICSL) and cannot be published or disclosed in part or in whole to any third party without the specific written consent of Aurum and ICSL. This document is incomplete without reference to, and should be viewed solely in conjunction with the verbal briefing, as may have been provided, by Aurum and ICSL. • This document shall be subject to the terms of any Non Disclosure Agreement that may have been entered into between Aurum and ICSL and the recipient to whom it is marked. • In preparing this document Aurum and ICSL have relied upon and assumed, without independent verification, the accuracy and completeness of all information available from published and public sources and/or provided to it for the purposes of this document. Accordingly, neither Aurum, ICSL nor any of its partners, employees, affiliates, agents or advisors make any representation as to the accuracy, completeness, reasonableness or sufficiency of any of the information contained in this document, and none of them shall be liable for any loss or damage (direct or indirect) suffered as a result of reliance upon any information contained in this document, or any omission of any information from this document and any such liability is expressly disclaimed. • Aurum and ICSL have developed this document and all concepts, structures, recommendations and analyses are proprietary to Aurum and ICSL and cannot be used without the express written consent of Aurum and ICSL. • This document has been prepared for preliminary discussion purposes only without prejudice and should not be construed as an offer or invitation to purchase or sell any securities, businesses, or assets of any entity referred to in this document. • This deck covers developments in particular for the period 01 December 2017 to 31 December 2017 2
  3. 3. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITEDIndex S. No. Section Page 1. Restructuring Status Update 4 2. Key Developments in December 2017 8 3. RBI’s list of Defaulters 14 - First List of Defaulters 15 - Second List of Defaulters 18 4. Annexures 20 - Cases filed with NCLT in December 2017 21 - About Aurum + ICSL Consortium 23 3
  4. 4. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 1 Restructuring Status UpdateSECTION 4
  5. 5. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 5 Key Industry Statistics 452 Cases filed with NCLT till 31st Dec 2017 and the number is expected to increase as indicated by the trends below 19 54 30 68 80 64 38 34 36 13 9 7 0 20 40 60 80 100 December November October September August July June May April March February January Quantum of Unique Cases Filed* Sector Wise Allocation (by number of cases filed) 25% 16% 14% 10% 8% 8% 3% 3% 2% 2% 1% 1% 7% Industrials^ Metals and Mining Infrastructure and Real Estate CRFAB^^^ Energy Textiles TME Healthcare and Pharmaceuticals BFSI Logistics Education Aviation Others^^ Source: IBBI, Aurum Research Industrials, Metals & Mining and Infrastructure & Real Estate sectors account for 55% of the cases filed (by volume) Announced on IBBI website till 3rd January 2018Announced on IBBI website till 3rd January 2018 ^Industrials includes – Chemicals, Cement, Auto and Auto Parts, Machinery, Paper, Valves, Tiles, Mills, Electricals. ^^Others includes – Security Services, Consulting Services, Facility Management, Printing Services etc. ^^^CRFAB- Consumers, Retails, Food , Agri and Beverages *Multiple cases against a corporate debtor counted as one
  6. 6. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 6 Key Phases- Resolution Process Phases Phase 1 Phase 2 Phase 3 Phase 4 Timeline of the proceedings Activities to be undertaken First 30 days from the date of filing Day 31 to Day 150 Day 151 to Day 180/270 Case Resolved/ Liquidation Proceedings (If Required) ▪ Declare moratorium ▪ NCLT to appoint interim resolution professional. ▪ Public announcement ▪ Appoint 2 registered valuers to calculate liquidation value ▪ Submission of Proof of claims ▪ Verification of claims by IRP ▪ IRP to constitute CoC and file a report ▪ Convene and hold 1st CoC meeting ▪ Appointment of resolution professional ▪ Preparation of complete IM ▪ Submission of resolution plan ▪ CoC’s approval of resolution plan ▪ Approval of resolution plan by NCLT ▪ Case resolved OR ▪ Liquidation order will be passed if: ➢ CIRP ends ➢ Plan not submitted to NCLT ➢ Plan not approved ➢ Decided by CoC ➢ Plan not properly implemented
  7. 7. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 7 Phase wise Analysis- Cases with NCLT* Phase 1: First 30 days from the date of filing Phase 2: Day 31 to Day 150 Phase 3: Day 151 to Day 180/270 Phase 4: Case Resolved/ Liquidation Proceedings (if required) 19 223 185 5+20 Western India Shipyard Easun Reyrolle Stesalit Ltd Falcon TyresJaypee Infra Lanco Infra Bhupen Elec VNR Infra Nicco Corp Source: IBBI, Aurum Research REI Agro KAC Yarn Innoventive Ind ELHPL Private Ltd. Rainbow Paper Anil Ltd Jenson & Nich. Bhushan P&S Electrosteel Bharati Defence Abhayam T Keshav Sponge Announced on IBBI website till 3rd January 2018 Synergies Dooray Liquidation Case Resolved Sree Metaliks Ltd Prowess Int’l Chhaparia Inds Kamineni Steel Gujarat NRE Bhushan Steel Monnet Ispat Era Infra ABG Shipyard Jyoti Structures Facor Steels Visa Power Kothari Indus. Corp. Shree Coke Manf. Orchid Pharma
  8. 8. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 2 Key Developments in December 2017 SECTION 8
  9. 9. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 9 Key Legal/ Regulatory Developments Source: IBBI, Ministry of Corporate Affairs, Dua Associates Key Circulars/ Notifications IBBI amended the IBBI (Insolvency Resolution Process For Corporate Persons) Regulations, 2017 (“Regulations”) vide its notification dated December 31, 2017. The key amendments are as follows: ▪ Amended Regulations define ‘dissenting financial creditor’ to mean a financial creditor who voted against the resolution plan or abstained from voting for the resolution plan, approved by the committee of creditors. ▪ Resolution professional is now required to provide the liquidation value to every member of the committee of creditors after obtaining an undertaking from the members that they shall maintain confidentiality with regard to the liquidation value, and further that the members shall not use such value to cause an undue gain or undue loss to themselves or any other person. Further, the interim resolution professional or the resolution professional, as the case may be, are also required to maintain confidentiality with respect to the liquidation value. ▪ The time frame for submission of Resolution Plan by the Resolution Applicant shall be specified in the invitation to submit such Resolution Plan, circulated by the Resolution Professional. The Insolvency and Bankruptcy Board of India (Grievance and Complaint Handling Procedure) Regulations, 2017 ▪ The Insolvency and Bankruptcy Board of India (“IBBI”) has introduced the IBBI (Grievance and Complaint Handling Procedure) Regulations, 2017 (“Regulations”), which enables stakeholders, like debtors, creditors, any other person having an interest, in an insolvency resolution, liquidation, voluntary liquidation or bankruptcy transaction under the Code, to file a grievance against a service provider, namely, the insolvency professional agency, insolvency professional, insolvency professional entity or information utility.
  10. 10. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 10 Key Legal/ Regulatory Developments Source: Dua Associates Key Judgments In case of Macquarie Bank Limited v. Shilpi Cable Technologies Limited (decided on 15th December, 2017) ▪ The Hon’ble Supreme Court while deciding the question as to whether, in relation to an operational debt, it is mandatory to file a copy of the certificate from the financial institutions maintaining the (bank) account of the operational creditor, confirming that no payment has been made in respect of the unpaid operational debt by the corporate debtor, as required under Section 9(3)(c) of the Insolvency and Bankruptcy Code, 2016 (“Code”), held that the said requirement under Section 9(3)(c) of the Code is not a condition precedent to triggering the insolvency resolution process under the Code. It is only a piece of evidence to confirm the existence of the debt rather than a precondition. The Court found the provision of Section 9(3)(c) of the Code to be directory and not mandatory in nature. ▪ The Court also deliberated on the issue of whether a demand notice of an unpaid operational debt can be issued by a lawyer on behalf of the operational creditor and held that Section 8 and 9 of the Code and Section 30 of the Advocates Act, 1961 can be read harmoniously, thereby yielding the result that a notice can be sent on behalf of the operational creditor by its authorized agent which includes its lawyer.
  11. 11. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 11 Select New Cases in December 2017 Source: IBBI Dev Blessing Traders Private Ltd KAC Yarn Private Limited Global Gallarie Agencies Pvt. Ltd Sri Naga Nanthana Mills Limited Shree Coke Manufacturing Company Quetzel Furniture Systems Pvt Ltd Luxury Trains Private Limited Sarash Export Services Private Limited ELHPL Private Ltd Balaji Polysacks Pvt Ltd. Visa Power Ltd. Western India Shipyard Ltd Varia Engineering Works Pvt. Ltd. DPL Builders Pvt Ltd Dooteriah & Kalej Valley Tea Estates Kothari Industrial Corporation Ltd. Royal Splendour Developers Pvt Ltd Shree Radhe Industries Inland Facilities Management Pvt Ltd
  12. 12. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED ▪ The Supreme Court allowed Jaiprakash Associates Ltd to deposit INR 125 crore by 25 January 2018, granting an extension against an earlier deadline of December end. Jaypee Infra ▪ SBI filed an insolvency petition against IVRCL in Hyderabad bench of NCLT. 12 Other Developments IVRCL ▪ NCLT has extended time period for CIRP for Electrosteel Limited by a period of 90 days with effect from January 17, 2018. Electrosteel Steels ▪ NCLT admits petitions for insolvency resolution against Ruchi Soya Ruchi Soya ▪ The Chennai bench of the NCLT has dismissed corporate insolvency resolution process against Trivitron Healthcare following its compromise with the creditor. Trivitron Healthcare
  13. 13. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 3 RBI’s list of DefaultersSECTION 13
  14. 14. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 3A First List of Defaulters 14
  15. 15. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITEDKey Cases (1/3) Name of Company Industry O/S Debt (INR mn) Revenue (INR mn) FY Market Cap* Completion of Restructurin g Status Update^ Bhushan Steel Limited Metals and Mining 462,632 150,273 FY17 15,369 22-Jan-2018 • Last date of filing claims by creditors was 9th August 2017 • And the last date to submit EOI bids was 23rd December 2017 • Potential Bidder s: ArcelorMittal, Tata Steel, JSW+JFE Consortium, SAIL Lanco Infratech Limited Infrastructure 435,018 73,437 FY17 5,290 3-Feb-2018 • Last date of filing claims by creditors was 22nd August 2017 • And the last date to submit EOI bids was 4th Jan 2018 • Potential bids were invited for the sale of Renewable Power portfolio & Ennore thermal EPC work by 31st Dec 2017 & 10th Jan 2018 respectively Bhushan Power & Steel Energy 356,850 76,998 FY16 NA 22-Jan-2018 • Last date of filing claims by creditors was 9th August 2017 • And the last date to submit EOI bids was 23rd December 2017 • Potential Bidders: JSW, Piramal Bain Fund, AION Capital, Vedanta, Tata Steel Essar Steels Limited Metals and Mining 312,110 156,497 FY16 NA 29-Jan-2018 • Last date of filing claims by creditors was 16th August 2017 • And the last date to submit EOI bids was 23rd December 2017. • Potential Bidders: Tata Steel, Essar G. 15*Market Cap as of 4th Jan 2018Source: Aurum Research ^As from various News Sources
  16. 16. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 16Source: Aurum Research Key Cases (2/3) Name of Company Industry O/S Debt (INR mn) Revenue (INR mn) FY Market Cap* Completion of Restructuring Status Update^ Era Infra Engineering Infrastructure 101,290 12,731 FY17 474 NA • Currently, insolvency proceedings against Era Infra is on hold. ABG Shipyard Limited Industrials - Shipbuilding 87,307 343 FY16 735 28-Jan-2018 • Last date of filing claims by creditors was 16th August 2017 • And the last date to submit EOI bids was 21st September2017 • Potential Bidders: Mahindra & Mahindra, Shapoorji Pallonji Group Jaypee Infratech Ltd Infrastructure 79,222 11,581 FY17 32,293 5-Feb-2018 • Last date of filing claims by creditors was 24th August 2017 • And the last date to submit EOI bids was 7th November 2017 • 21 bidders have given their EOI including JSW Group, Vedanta Ltd, Lodha Group, Essel Group, Deutsche Bank, etc. • All final bids will be submitted before creditors by February 10, 2018 after shortlisting by IRP Electrosteel Steels Limited Metals and Mining 76,161 27,743 FY17 14,166 16-Jan-2018 • Last date of filing claims by creditors was 4th August 2017 • And the last date to submit EOI bids was 26th December 2017 • Potential Bidders: SREI Infra, Tata Steel, Mesco Steel, Edelweiss ARC, Piramal G. *Market Cap as of 4th Jan 2018^As from various News Sources
  17. 17. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 17Source: Aurum Research Key Cases (3/3) Name of Company Industry O/S Debt (INR mn) Revenue (INR mn) FY Market Cap* Completion of Restructuring Status Update^ Alok Industries Limited Textiles 234,430 89,194 FY17 5,647 14-Jan-2018 • Last date of filing claims by creditors was 1st August 2017 • And the last date to submit EOI bids was 12th Oct 2017 • Potential Bidders: Reliance Industries, Employees of Alok Industries • IRP seeking fresh bids Monnet Ispat & Energy Limited Energy 103,333 13,751 FY17 6,696 13-Jan-2018 • Last date of filing claims by creditors was 7th August 2017 • And the last date to submit EOI bids was 20th November 2017 • Aion-JSW was the sole bidder • Creditors seeking fresh bids Jyoti Structures Ltd. Infrastructure 33,873 9,034 FY17 1,503 31-Dec-2017 • Last date of filing claims by creditors was 26th July 2017 • And the last date to submit EOI bids was 12th September2017 • Sharad Sanghi led group of HNIs was the sole bidder • Creditors seeking fresh bids Amtek Auto Limited Industrials- Automobiles 39,281 19,668 FY17 7,137 20-Jan-2018 • Last date of filing claims by creditors was 10th August 2017 • And the last date to submit EOI bids was 11th September2017 • Potential Bidders: Bharat Forge, Aion Capital, SSG, Deccan Value, Liberty Hou. *Market Cap as of 4th Jan 2018^As from various News Sources
  18. 18. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 3B Second List of Defaulters 18
  19. 19. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 19Source: Public Sources RBI’s second List- Key Companies CIRP process initiated under NCLT Anrak Aluminium Asian Colour Coated Ispat BILT Graphic Paper Products Castex Technologies Coastal Projects East Coast Energy IVRCL Jayaswal Neco Industries Orchid Pharma SEL Manufacturing Soma Enterprise Uttam Galva Metallic Uttam Galva Steel Videocon Telecom Videocon Industries Visa Steel Essar Projects Jai Balaji Industries Jaiprakash Associates Monnet Power Nagarjuna Oil Refinery Ruchi Soya Industries Wind World India Shakti Bhog Foods Limited Unity Infraprojects Aban Offshore Transstroy India Ushdev International
  20. 20. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 4 AnnexuresSECTION 20
  21. 21. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 4A List of Cases filed with NCLT in December 2017 21
  22. 22. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 22 S.No. Name of Corporate Debtor Last Date for Claims Date of Completion of Restructuring (180 days) Industry 1 Western India Shipyard Limited 10-Jan-18 09-Jun-18 Others- Marine Port & Services 2 Visa Power Limited 06-Jan-18 20-Jun-18 Energy 3 Shree Coke Manufacturing Company Private Limited 06-Jan-18 20-Jun-18 Energy 4 Kothari Industrial Corporation Limited 08-Jan-18 17-Jun-18 CRFAB- Agrochemicals 5 Varia Engineering Works Private Limited 03-Jan-18 18-Jun-18 Metals & Mining 6 Quetzel Furniture Systems Private Limited 03-Jan-18 16-Jun-18 CRFAB- Furniture Manufacturing 7 Balaji Polysacks Private Limited 02-Jan-18 13-Jun-18 CRFAB- Bags 8 Luxury Trains Private Limited 29-Dec-17 10-Jun-18 Others -Luxury train Services 9 Inland Facilities Management Private Limited 25-Dec-17 02-Jun-18 Others- Security services 10 DPL Builders Private Limited 22-Dec-17 08-Jun-18 Real Estate & Infra 11 Sarash Export Services Private Limited 21-Dec-17 05-Jun-18 Others 12 Dev Blessing Traders Private Ltd 29-Dec-17 30-May-18 Others 13 Global Gallarie Agencies Pvt. Ltd 26-Dec-17 03-Jun-18 Other Services- Automotive 14 Dooteriah & Kalej Valley Tea Estates Private Ltd 28-Dec-17 09-Jun-18 CRFAB 15 Sri Naga Nanthana Mills Limited 25-Dec-17 10-Jun-18 Textiles 16 KAC Yarn Private Limited 25-Dec-17 10-Jun-18 Textiles 17 Royal Splendour Developers Private Ltd 18-Dec-17 02-Jun-18 Real Estate & Infra 18 Educomp Learning Hour Private Ltd 23-Dec-17 08-Jun-18 Education 19 Shree Radhe Industries Limited 21-Dec-17 02-Jun-18 Industrials- Electric Cables & Equipments Cases admitted to NCLT in Dec 2017* Source: IBBI, Aurum Research*Announced on IBBI website till date by 3rd Jan 2018
  23. 23. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 4B About Aurum + ICSL Consortium 23
  24. 24. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED 24 Aurum + ICSL Consortium ICSLAurum Equity Partners LLP ▪ Led by Sajeve Deora, is amongst top Restructuring Professionals in India. ▪ Deep restructuring and turnaround experience of 33+ years with over one hundred cases handled, including : ➢ Sales of shares and Changes of management of stress companies ➢ Sales of assets of companies in Stress ➢ Sales in Court processes wherein borrowers are in Stress ➢ Formation of asset sale committees in discussions with lenders ➢ Dealing with documentation for sales of shares and assets, in cases of Stressed borrowers before BIFR, DRT, SARFAESI, CDR, Winding up proceedings, CLB proceedings, etc. ▪ India partner of BTG Global Advisory - an international alliance of independent restructuring and financial advisory firms operating in key jurisdictions across the globe. Services include - Turnaround advisory and implementation, Performance improvement consulting, Loan workout, Interim management, Managed Exit Services, Forensic Accounting etc. ▪ India wide network through associated advisory firms in Mumbai, Chandigarh, Chennai, Hyderabad, Bengaluru, Kolkata. ▪ Team comprises of Accountants, Lawyers and Tax Experts. ▪ Led by Sanjay Bansal, with 25 years of deal experience and one hundred and fifty successful transaction closures ▪ Deep industry knowledge of sectors that are the cornerstone of growth in the Indian economy ▪ Deep restructuring experience within the team through Resolution by M&A (Example Deals – Deccan Chronicle, BPL and Birla Tyres Business Acquisition by JK Tyres) ▪ Senior management has 50+ years of experience in deal making and have successfully closed 150+ transactions. ▪ Long standing relationships with Key Institutional Investors – Indian and Global as well as Indian business houses. ▪ Part of the following global networks: ➢ Crowe Horwath International – a global top-10 advisory network with 726 offices in 125 countries with more than 30,000 employees. ➢ Black Olive Ventures – a real-estate focused fund management and investment banking firm ▪ Professionals include MBAs, CAs, Engineers etc with offices in Delhi, Bangalore and Mumbai.
  25. 25. Strictly Confidential INTEGRATED CAPITAL SERVICES LIMITED Thank You Contact Persons: 25 Sanjay Bansal Founder & Managing Partner Aurum Equity Partners LLP Tel: +91 124 4424477 Mob: +91 98110 10810 Email: sanjaybansal@aurumequity.com Sajeve Deora Director Integrated Capital Services Limited Mob: +91 98119 03450 Email: sajeve.deora@deora.com

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