Bids for KSK Mahanadi Power Surge Following Adani Group's ₹12,500 Crore Offer.

Adani Group's ₹12,500 crore bid to acquire KSK Mahanadi Power has sparked increased interest from other bidders, prompting them to revise their offers upwards significantly, sources indicate. Following the introduction of the Committee of Creditors (CoC) Challenge Mechanism, lenders to the distressed power plant are now optimistic about a potential full recovery from the non-performing asset, a notably rare occurrence in the Insolvency and Bankruptcy Code (IBC) process.

Insiders within the IBC framework attribute the renewed interest in KSK Mahanadi to Adani's initial high bid, which was 62% or ₹4,800 crore above the next highest offer. Six of the original ten bidders, including NTPC, have now submitted revised offers that are competitive with Adani's bid, reflecting strong market interest and driving up the asset's value. This development underscores the IBC's focus on value maximization, industry insiders noted.

Adani's competitive bid, when combined with KSK Mahanadi's cash reserves of ₹10,000 crore and trade receivables of ₹4,000 crore, brings the total value to approximately ₹27,000 crore, potentially allowing lenders to achieve an unprecedented recovery rate of 92%.

Located in Chhattisgarh, KSK Mahanadi has an installed capacity of 1,800 MW and was brought into the IBC process in 2019 with accumulated debts of ₹29,330 crore. Adani's bid is currently the highest among competitors, which include major players like JSW Energy, Jindal Power, Vedanta, NTPC, and Coal India. Previous bids had ranged between ₹6,500 crore and ₹7,700 crore, significantly lower than Adani's proposal.

Despite Adani's strong offer, the CoC's Challenge Mechanism was implemented to stimulate further competition, resulting in improved bids from remaining contenders. This bid for KSK Mahanadi marks a pivotal moment for the IBC, as corporate influence and the potential for value maximization intersect. While some may view the consolidation of power as concerning, others argue it represents a necessary evolution in India's insolvency landscape.

BS